Food Monopolies

The following article is from The Great Soviet Encyclopedia (1979). It might be outdated or ideologically biased.

Food Monopolies


of the capitalist countries. The main branches of the food industry in the capitalist world are controlled by a few monopolies. Unlike other branches of industry, in which the biggest monopolies are, as a rule, American, the leading food monopoly (in terms of volume of turnover) is Unilever, an Anglo-Dutch firm, and the second largest is the Swiss-owned Nestlé Alimentana S.A. Several US monopolies are ranked after these. In the USA the food industry—especially meat-packing and the dairy industry—is highly monopolistic. The same is true in Great Britain, the Netherlands, and other Western European countries, where monopoly control is especially pronounced in such industries as animal fats, tea, coffee, and cocoa and chocolate, which are based on the processing of imported materials.

The major food monopolies control the production of particular commodities abroad, as well as in their home countries. By exporting goods and capital, they have cornered the world capitalist market for many food products. The greatest degree of foreign economic expansion is associated with Unilever, Nestlé, and US monopolies that produce nonalcoholic beverages (the Coca Cola Company, for example). In the former colonies and dependent countries, the food monopolies control the production and supply of certain types of valuable raw materials. The American food monopolies dominate the meat-packing industry in South America. The United Fruit Company owns vast banana, coffee, and sugarcane plantations in Central America. From the banana trade alone, United Fruit makes up to 600 percent on its capital investment.

By monopolizing the production of food commodities, maintaining high monopoly prices on goods, and paying extremely low prices for raw materials, the food monopolies exploit the people.

Almost all of the food monopolies have specialized for a long time in marketing a particular group of food products, such as meat, dairy, or cereal products. In the context of the scientific and technological revolution, the food industry’s plants, like those in other traditional branches of industry, have lagged noticeably in their rate of growth, compared to plants operated by new, progressive branches, such as electronics. In connection with the sharp competition between branches of industry, the food monopolies have begun to diversify intensively, penetrating subsidiary branches of the industry that are new to them and more profitable, as well as other branches of production and the service industries. The Western European food monopolies are pooling their efforts and cooperating with other monopolies to corner the markets for particular goods or services. In 1971, Unilever and Nestlé concluded an agreement for joint operations in supplying frozen foods to Western Europe, in practice consolidating their monopoly over this market. Nestlé signed an agreement in 1970 with the rail freight monopoly in Western Europe to establish a joint network of restaurants in continental Europe, the Middle East, and Africa. In their race for high profits, the food monopolies engage in deceptive practices and adulterate their products.

Unilever, the Anglo-Dutch food monopoly, is the largest producer of edible fats in the capitalist world, controlling more than 40 percent of the production of margarine. It also controls more than 30 percent of soap production in the capitalist world. Unilever processes a third of all the fats and oils on the world market. In addition, it owns instant-tea factories in the USA. Established by the merger of the British soap trust Lever Brothers (founded in 1894) and the Dutch margarine trust Margarine Unie (1927), Unilever extended its influence throughout the capitalist world in a relatively short time, penetrating such industries as vegetable oils and fats, soap, food, and cosmetics in the USA, Great Britain, the Netherlands, the Federal Republic of Germany (FRG), France, and other countries. The rapid growth of this monopoly is inextricably linked with the world wars and with the colonial expansion of British imperialism. During World War II, Unilever’s turnover more than doubled. Its product range includes many food products (52 percent of total sales in 1972) and other goods. Unilever controls more than 600 companies in 64 countries. Its chief areas of operations are Western Europe (65 percent of the company’s turnover), America (15 percent), and Africa (14 percent). Unilever owns approximately 200 plants, 150 of which are located in Western Europe. Its subsidiary, the United Africa Company, owns a vast network of plantations (for example, banana, rubber, and coconut), as well as industrial and commercial enterprises, in approximately 20 African countries. Unilever is headed by two formally independent holding companies—Unilever N.V. (Rotterdam) and Unilever Ltd. (London). It is closely associated with the

Table 1. Largest food monopolies of the capitalist world in 19721
 Founding dateTurnover (millions of dollars)Assets (millions of dollars)Working capital (millions of dollars)Gross profit (millions of dollars)Employees (thousands)
1Listed acording to volume of turnover, in descending order 2Net profit
Nestlé Alimentana S.A.18664,1303,2641,7021712116
Swift and Company .18553,2419364667933.6
Kraftco ........19233,1971,24582620848.9
General Foods Corporation ....19222,4241,59681924648.5
Beatrice Foods Company......19242,38493451916062.0
Borden Company . .18992,1931,33372513746.7

largest monopoly groups located in the Netherlands (the Amsterdam-Rotterdam Bank) and Great Britain (the Midland Bank).

The Swiss food monopoly Nestlé, which originally specialized in the production of condensed milk, is the largest producer of instant coffee. In addition, Nestlé controls 30 percent of the market for dietetic products in the FRG and 55 percent of the same market in France and Switzerland. It also owns one of the FRG’s largest brewing companies and one of the leading food companies in France. In 1971 dairy products accounted for 25 percent of its turnover, baby foods and dietetic foods for 7 percent, and nonalcoholic beverages (including instant coffee) for 32 percent. In 1973, Nestlé owned 297 plants, including 11 in Switzerland, 132 in other Western European countries, and 26 in the USA. Of Nestlé’s employees, 95 percent work in plants outside Switzerland. The company is closely linked with the largest Swiss banks and with the American Morgan Guaranty Trust Company.

The world’s largest meat-packing trust is Swift and Company, the leading food monopoly in the USA, which is the main area for the company’s operations. Swift and Company monopolizes the buying and slaughtering of livestock, as well as meat processing in a number of states. The company also owns plants in Canada and Great Britain. In 1971 food products accounted for 75 percent of its sales (meat and meat products, poultry, dairy products, ice cream, and edible fats). Swift and Company owns approximately 170 plants. The company is within the sphere of influence of the Chicago financial group.

Kraftco is the USA’s leading monopoly in dairy products, which accounted for 56 percent of the company’s sales in 1972. It is the world’s largest producer of packaged convenience foods (35 percent of the world output). The company also produces ice cream and frozen desserts, chemical products, cosmetics, and glass containers. In the late 1960’s, Kraftco expanded its foreign economic operations, establishing plants for the production of margarine and ice cream in Spain and Ireland, sausage plants in Canada, and plants for the production of cheese in Japan. In 1972, Kraftco’s 25 enterprises outside of the USA accounted for 13 percent of its sales. (Most of the company’s foreign plants are located in Western Europe.) A number of US financial groups control Kraftco.

The General Foods Corporation, another US food monopoly, is one of the world’s leading producers of packaged foods and the USA’s largest producer of instant coffee. General Foods also puts out various types of drinks, desserts, and grocery products. It operates a large network of restaurants and snack bars, including self-service units, in the USA and Canada. Since the early 1970’s the company has produced chemical products, cosmetics, toys, and a number of other goods. In 1972 the company’s foreign operations accounted for 25 percent of its sales, with Canadian operations contributing 8 percent of this figure. General Foods owns 70 plants, including 34 that are located outside the USA.

The Beatrice Foods Company, the second largest US producer of dairy products, is one of the youngest and most rapidly expanding of the food monopolies. In 1970 alone it absorbed 30 firms. Its product range consists of 8,000 items, including 600 dairy products. In 1972 food products and related production and service operations in the USA and other countries accounted for approximately 75 percent of the company’s turnover. The Beatrice Foods Company owns more than 600 plants and refrigerated warehouses in the USA, as well as 26 abroad.

The Borden Company occupies an important place in the American dairy industry, which was for a long time the company’s main area of operations. Since the mid-1960’s, Borden has begun to penetrate other branches of the food industry. In addition to milk products and chemical products for industry and agriculture, it turns out a wide range of food products, including cheeses, baked goods, canned fruits and vegetables, instant coffee, frozen foods, sugar, and mineral water. These products accounted for 38 percent of the company’s sales in 1972. The Borden Company owns 170 enterprises in the USA. Its 80 plants in 25 other countries account for 15 percent of its turnover.


The Great Soviet Encyclopedia, 3rd Edition (1970-1979). © 2010 The Gale Group, Inc. All rights reserved.