In 'Raw Deal,' A Reporter Reveals the Dirty Underbelly of the Meat Industry | Civil Eats

In ‘Raw Deal,’ A Reporter Reveals the Dirty Underbelly of the Meat Industry

The ‘billionaire beat’ reporter for Forbes talks about her new book, why she thinks consumers should be paying more attention to meat industry consolidation, and the starting points for systemic change.

reporter chloe sorvino and the cover of her new book, raw deal

Back when she was working the “billionaire beat” for Forbes, financial journalist Chloe Sorvino scheduled an exciting reporting trip: Not only had she managed to find a “new” billionaire to cover, but she had also managed to convince him to agree to an unprecedented interview.

That billionaire was Henry Davis, the third-generation owner of Greater Omaha Packing—the fifth largest beef producer in the U.S. and Sorvino’s slaughterhouse tour, tomahawk steak dinner, and interview with Davis gave her a glimpse of the sheer wealth and power that exists among the largest players in the meat industry. The trip also marked the beginning of her journey to trace exactly how that power has grown and consolidated in recent years, and the impact it has had on both sides of the supply chain.

“The top four beef companies have 80 to 85 percent control over the industry. I remember thinking through how Greater Omaha—the next on the list—has a way smaller amount, but still had $1.5 billion in revenue at the time,” said Sorvino. “That reporting trip was a big moment for me in realizing just how massive the consolidation of wealth and power in the meat industry was, and how much more there was to uncover.”

Five years later, Sorvino’s first book, Raw Deal: Hidden Corruption, Corporate Greed, and the Fight For the Future of Meat, documents in great detail the tactics deployed by the U.S.’ largest meat companies to consolidate their respective markets and maintain power.

In Raw Deal, Sorvino asks a wide range of experts how much longer the increasingly fragile and consolidated meat supply chain can withstand the pressures of climate change. Looking forward, she argues that the money being invested into securing the future of food is focused on continuing to accumulate power among the wealthy at the expense of more equitable solutions, such as universal food access.

Civil Eats spoke with Sorvino recently about why she thinks more consumers should be paying more attention to consolidation in the meat industry, the investor rush to fund alternative proteins, and the starting points for systemic change.

Why did you call the book Raw Deal?

On every level of the system at this point—farmers, workers, eaters—we are all getting a raw deal. There are trade-offs on every level and there are so many different problems involved with how meat is produced. It’s also a call to the alternative protein challengers that I discuss. I think they’re trying to do great stuff, but they’re still burning [through] a lot of money. You’re not going to get entrepreneurial change driven by the people who already had access to the capital to begin with. “Raw Deal” felt fitting to encompass all of that.

Who is the audience for this book? What are you hoping they take away?

I wrote it with the intention of having the finance community, bankers, loan officers, farmers, executives, and middle managers at these meatpackers to read it, and hopefully drive change within their own workplaces.

I am one of the few people that a lot of these billionaires speak to. In 2020, I was hearing meat billionaires saying that when it’s raining gold outside, they’re walking around with buckets. At the same time, I was reading the IPCC reports, and I’m seeing the horrific impacts of drought and extreme weather, extreme heat, and workers being impacted.

I want people to understand that the meat industry has to change, and that there needs to be a complete repurposing of how these companies do business. Not just because of how problematic it is, but also because climate change is going to upend their businesses.

What is the relationship between consolidation of power in the meat industry and supply chain vulnerability?

I think the fact that these companies have so much power has helped them accumulate profits that lets them continue to squeeze out competition, and withstand drought better than others. Over the last three decades, both the meatpackers’ and the retailers’ share of consumer dollars spent on meat has grown, while the producers’ share has steadily dropped. The meatpackers have really taken from both sides, especially from the producer, and they’ve held on to most of the profits for each dollar spent on meat. They’ve only really been able to do that through having the power to exploit vulnerability.

You highlight a term in the book that I had never heard before: monopsony. What is that and why is it important for readers to understand?

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A monopoly refers to producers, while monopsony is the way to understand the buyers’ side. A monopsony is when there is only one or a handful of buyers in a market.

I first heard about monopsony from Mark Lauritsen, the head of the meatpacking division at the United Food and Commercial Workers Union. He told me that he’d be in bars with different meatpacking executives or he’d hear directly from a plant that a large retailer would want to purchase meat at lower prices. If the meatpacking plant said they couldn’t, the retailer would respond and say, “We’re ending this contract. We don’t care enough about you. We have the power to do that.” And then, as a result, that plant had to fire a bunch of employees. Lauritsen and the union saw it stemming from the buyer.

What he was talking about was monopsony power and I’ve been fascinated with the concept ever since. Meatpackers often use monopsony power as an excuse for why they have to keep [payments to farmers and ranchers] so low. They claim to be beholden to Walmart, Amazon, Kroger, Albertsons, etc. And at the end of the day, the retail landscape does control a lot of power and money. They’ve been able to take more from producers and hold more of that consumer dollar spent on meat, because the buying power of retail giants has been increasing in the past few decades. It has become clear that you can’t solve the monopoly problem without also solving the monopsony problem.

You discuss at great lengths the working conditions across the meat industry. To what extent are those conditions a product of consolidation?

I read hundreds of lawsuits from different workers for the chapter on the human cost of eating meat. I picked those cases in Raw Deal specifically because at the end of the day, what my research told me is that meatpacking plants have become extremely dangerous for workers. Many of these workers are migrants and refugees who speak different languages. They are some of the most vulnerable and silenced workers across the nation. And meatpacking already is such a hidden industry, it’s so opaque, and that’s why they are able to do a lot of these controversial practices.

I really wanted to highlight class action [lawsuits], but also specific cases of harassment and discrimination because these workplaces have bred violence. Violence that is physical, but also financial in terms of wage manipulation. It really has become ubiquitous and quite scary.

Some people are calling alternative proteins the future of food. What has drawn investors to these foods? Is there the risk of history repeating itself?

Absolutely. History is repeating itself—there was an alternative protein bubble that I wrote about that accelerated quickly and is almost entirely burst by now.

Before the recent high-tech food investment boom, there were only a few investors in the food space, and they expected healthy, reasonable foods, knowing that people can only eat so much and therefore a food company can only grow so much. They were expecting maybe a one- to five-times return [on their investments].

Over the past decade, you’ve seen a lot of investors, specifically in Silicon Valley, who had previously invested in big valuation tech companies and startups that earned them significant returns. When those funds ended up rolling over, they had all these new profits. They had already blown up the tech markets, so they were looking around saying, “Okay, where do we put all this new money?”

A lot of them had good intentions [in investing in alternative proteins], but a lot of them just wanted to make more money. So, you had these investors pouring millions if not billions of dollars into food startups, which then had crazy valuations and completely impossible standards for these founders to meet. Alternative protein now has the most funding of any food sector, but we never really saw the adoption of “meatless meats” by consumers, which is why these expectations didn’t meet reality. Alternative proteins still make up just less than 1 percent of total meat sales. The companies’ growth rates were super high for a while, but the actual velocity, actual adoption, and actual repeat purchases still have not happened.

Today’s food system is complex.

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I wanted to write about this because it is not something we can be trifling with. We only have a certain amount of time to make the necessary changes to address the climate crisis. And investors are looking at this from the perspective of making a quick buck, then exiting and investing in something else. But we don’t have enough time or resources to waste anymore.

In your opinion, what are the starting points for more fair, less profit-driven industry change?

This book lays out five potential solutions for different parts of this, like universal food for example. I’m very skeptical and concerned about cellular meat in a lot of ways, but I think if it were able to get some farm bill money or get subsidies that were to make sure it was open source and part of a framework for universal food I would be open to it. I think the open-source idea [for cellular meat] has been lost as investors commoditize the industry, which has been harmful and worrisome to see.

There also has to be a lot more local infrastructure. I’d love to see subsidies repurposed or farm bill funding going toward improving food distribution infrastructure in regional systems. I think at the end of the day, there’s a lot more that the government can do to incentivize local food economies. I would love to see more communal warehouses and kitchens, not just for the purveyors themselves to utilize, but also for actual communities to preserve their food in ways that do without the additives or over-processing that the food industry has made endemic to its products for decades.

You talk to economists, chefs, farmers, ranchers, animal behaviorists, venture capitalists, and CEOs of the world’s biggest meat companies. How did you approach structuring this story with such a wide range of information and sources?

I wanted to share what’s happening from a food systems perspective. I think everyone has something to share in this system and it has to come from every single part of the system.

In the conclusion of Raw Deal, there’s a great anecdote from the CEO of Tanka Bar about how bison face storms knowing that, as long as they keep walking, they will emerge on the other side. I think the only way for us to emerge from the current storm is by using the knowledge of every member of the herd: chefs, workers, advocates, climate experts, scientists, nutritionists, public health officials, executives, industry workers, the whole thing. Everyone needs to be part of this herd moving forward.

This interview was edited for length and clarity.

Lindsey Margaret Allen is the founder of Elemmay Productions, LLC and the Creative Producer and Host of POINT OF ORIGIN. Lindsey’s work is grounded in expanding awareness about supply chains as a means to help people make informed decisions about what they eat - in support of their own health as well as the health and well-being of our global communities and the environment. Read more >

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  1. Jody emel
    I’ve ordered the book. Can’t wait to see what she says about animal rights and welfare.

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