Foreclosing Food ChoicesPatrick WoodallResearch DirectorFood & Water Watch

Non-Price Effects of MergersAmerican Antitrust Institute SymposiumJune 15, 2016

Yanking the Food Chain

Seeds Farms Flour Mill Cereal Factory Distribution Supermarket Home

Reverberating Mergers Throughout the Food Chain77%

66%

Corn Soybean

Seed CR-2

64%

Post-2014 Flour Mergers CR-4

85%

Post-2015 Cereal Merger CR-4

FTC Blocked Sysco-

USFoodsmerger to monopoly

Wave of Supermarket

mergers exceeds the late 1990s

Hain Celestial

#79

ShariAnn's

M&M Mars

#11

Mondelez#19

(spinoff from Kraft)

Coca-Cola#5

Cargill#16

White-Wave

#39(spinoff of Dean)

ConAgra#7

Kellogg#13

Walnut Acres

Millina's Finest

Frutti di Bosco

Muir Glen

Celestial Seasonings

Imagine/Rice Dream/Soy

Dream

Little Bear

Arrowhead Mills

Bearitos

Spectrum Organics

Lightlife

The Organic Cow of

Vermont

Breadshop

Alta Dena

Westbrae

Mountain Sun

DeBole's

Earth's Best

Nile Spice

Health Valley

Westsoy

Cascadian Farm

Garden of Eatin'

Casbah

Horizon

Odwalla

Silk

Organic Industry Structure:

Acquisitions & Alliances, Top 100 Food Processors in

North America

October 2001

$181 M

July 1998, 13% Equity;January 2004, 100% Equity,

$216 M

Morningstar Farms/Natural

Touch

November 1999

$307 M

Organic Brand

Acquisitions

# Numbers refer to rank in North

American food & beverage sales

according to Food Processing,

August 2015

October1997

$23.5 M

June2003

October 2001

June 2001 September

1999from Heinz

March 2000

$390 M December2002

April 1999$80 M

April 1998$80 M

December 1998

Back to Nature

Boca Foods

Seeds of Change

1997

July 2000; September 2013, sold to Brynwood

PartnersDecember

1999

March1998

May 2002$189 M

May 1999

April 1999

June2000

September 2003100% equity;August 2012 majority stake

sold to Brynwood Partners

Kashi

August 2005$33 M

February 2000

Food Processors

#

HersheyFoods

#20

Dagoba

October2006

TofuTown

June 2007From Dean

Naked Juice

Pepsi#1

November 2006

Green & Black's

January 2010

Alexia Foods

July 2007

Wholesome & Hearty

BearNaked

November 2007

$122 M

Nestle#3

Tribe Mediterranean

Foods

September 2008, $57Mvia Israeli subsidiary Osem Group

(50.1% equity)

LaraBar

HonestTea

January 2016

February 200840% equity

$43 M;March 2011100% equity

June 2008

MaraNatha SunSpireMarch2008

Golden Temple

Peace Cereal

Willamette Valley

Granola

Food Should

Taste GoodFebruary 2012

Campbell Soup Co.

#25

Bolthouse Farms

July 2012$1.55 B

Phil Howard, Associate ProfessorMichigan State University

Hillshire Brands

(formerly Sara Lee)

Aidell's Sausage

May 2011$87 M

Sweet Leaf Tea

May 2011

Stonyfield

Brown Cow

J.M. Smucker

#23

R.W. Knudsen

Santa Cruz Organic

Late July

BluePrintNovember

2012

May2013

Ella's Kitchen

Happy Family

May 201392% equity

AB InBev#6

Goose Island

March 2011$38.8 M

Ralcorp(private label organic foods)

Bloomfield Bakers

Lovin OvenMarch 2007

$140 M

MillstoneNovember

2008

1984 1989

December 2007

19% equity;November

201480% equity

February 2003

October 200140% equity;

January 200485% equity

May 2013$158 M

May 2010$71 M

Miller-Coors

#15

Crispin

February 2012

Fox Barrel

January 2010

Olafson's Baking

Co.

February 2014

$1.7 B

July 2002

Perdue Farms

#29

Coleman Natural

May 2011

Hans

August 2003

August 2007

Draper Valley FarmsPetaluma/

Rosie

January 2002

Tea Forte

January 2012

Wolfgang Puck

July 2008

Foster Farms

#52

Humboldt Creamery

August 2009$19.5 M

CROPP(Organic Valley)

#91

Canada Bread Co.

TreeHouse Foods

#38

Sturm Foods

December 2009

$660 M

Naturally FreshMarch

2012$25 M

Hearthside Foods (cereal

division)

Meyer Natural Foods

December 2010

J&J Snack Foods

#93

Kim & Scott's

June 2012$7.9 M

June 2010; joint marketing agreement

November 2009, Stonyfield

brand licensed to CROPP for fluid milk

Danone(Dannon)

#46

Dakota Beef

Peet's Coffee &

Tea

August 2012$1 B

New Morning

December 2012

Erewhon

Plum Organics

May 2013

Earthbound Farm

December 2013$600 M

Enray

August 2013

PowerBarPriaFebruary 2014(from Nestle)

Golden Boy

December 2013

Dakota Growers

PastaSeptember

2013

Immaculate Baking

January 2013

Green Mountain

Coffee

February 201310% equity

$1.25 B2014 additional

7%

Hormel#14

Flowers Foods

#31

Pinnacle Foods

#45

EPICProvisions

Keurig Green

Mountain

Boulder Brands

(Earth Balance)

Alpine Valley Bread Co.

Dave’s Killer Bread

Suja Juice

Wallaby Yogurt

Garden Fresh

Gourmet

Applegate Farms

Blake’s

Annie’s Homegrown

So Delicious

Protenergy Natural Foods

Rudi’s Organic Bakery

August 201530% equity

$90 MJanuary

2015$1.15 BD.E. Master

Blenders(formerly Sara

Lee)

October 2013$10.4 B

Stumptown

December 2015

$13.9 B MOM/Malt-O-Meal/Better

Oats

Caribou

Einstein Bros./Noah

Intelligentsia

Mighty Leaf

September 2014

$374 M

August 2014

October 2015

October 2015

December 2012

January 2016

Rhythm Superfoods

January 2016partial equity

$3 M

November 2015

$975 M

September 2015

$120 M August 2015$275 M August 2015

$125 M

September 2014$195 M

June 2015$231 M

April 2014$61 M

May 2015

$775 M

May 2015

September 2014$820 M

Tyson#2

August 2014$8.5 B

Van’s

April 2014$165 M

April 2014

$150 M

Michael Foods

April 2014$2.45 B

Diamond Foods#97

October2015

$1.27 B

Kettle

February 2010$615 M

B&G Foods#95

TrueNorthMay 2013

Sioux-Preme

Packing

September 2015 FreeBird/

Plainville Farms

July 2014$40 M

Willamette Egg

Farms September 2015$90 M

Udi’s

June 2012$125 M

EvolDecember

2013$48 M

November 2015$2.7 B

from ConAgra

Bimbo Bakeries

#20

JABHolding

Company Post Foods#49

(spinoff from Ralcorp)

Snyder's-Lance

#68

General Mills

#10

Lifeway

October 200021.2% equity

Fresh Made Dairy

First Juice

Helios

July 2006$8 M

February 2009$14 M

September 2010Stacy’s

Pita Chip

November 2005

Concentrating Food Safety Risks

2011 Turkey Processing CR-4 = 55%

Rampaging Retailers

50.7%

53.0%53.9%

57.4%

59.3%

2009 2012 2014 2015 2016*

Source: Food & Water Watch analysis of Supermarket News/Progressive Grocer, * post Ahold-Delhaize merger estimate.

Supersizing the Supermarket National Market Share of Four Largest Grocery Retailers

SelectedDelhaize

SelectedPiggly Wiggly

Winn-Dixie

750 Stores NationwideBI-LO, Winn-Dixie, Harveys, Sweetbay, Reid’s

SOUTHEAS

TERN

GROCERS

ALBERTSO

N’S

Safeway

2300 Stores NationwideAlbertsons, Acme, Jewel-Osco, Supervalu,United Supermarkets, Safeway, Von’s,Randall’s, Dominick’s and more

KROGER Harris

Teeter

2600 Stores NationwideKroger, Dillon’s, Fred Meyer, Harris Teeter,Ralph’s, Fry’s, Food 4 Less and more

Supermarket ConsolidationMajor Supermarket Mergers 2012-2015

AHOLD

Delhaize

2,000 Stores NationwideGiant, Stop & Shop,Food Lion, Hanneford

PROPOSEDMERGER

Top 4 Retailers Control Over 90% Grocery Sales2004

Source: Food & Water Watch analysis of MetroMarket data.

Top 4 Retailers Control Over 90% Grocery Sales2011

Source: Food & Water Watch analysis of MetroMarket data.

Illusion of Choice

87.9%

80.8%82.7%

79.9%

75.7% 76.7% 75.8%

68.7%

64.8% 63.8%

60.3%

92.0%

87.0% 86.7%85.0%

78.9% 78.7%

74.2% 73.2%

68.1% 67.5%

60.6%

Soda* Chocolate Performance Bars

Breakfast Cereal

Potato Chips Ketchup** Refrig. Yogurt*

Peanut Butter Pasta Sauce Coffee Lunch Meat

2010-2011 2014-15

Top Four Market Share by Grocery Category

Source: Grocery Goliaths and preliminary update; * only 3 major firms, ** only 2 firms in 2014/5

UnileverPromise

ConAgra FoodsParkay

Top 4 Companies

89.2%

MargarineMarket Share

58.4%

19.2%

Many Brands, Few Manufacturers

Unilever(58%)

Shedd’sCountry Crock

(8¢/oz.)Imperial (6¢/oz.)

Promise (w/ Olive Oil

20¢/oz.)

Brummel & Brown

(w/ Yogurt 19¢/oz.)

I Can’t Believe It’s Not Butter! (14¢/oz.)

ConAgra (19%)

Parkay(10¢/oz.)

Fleishmann’s (18¢/oz.)

Blue Bonnet (7¢/oz.)

Source: Food & Water Watch, Grocery Headquarters 2016

Kraft Conglomerate Octopus 2011

Kraft Foods

Dry Mac & Cheese (79.9%)

Hispanic Food

(1.7%)

Processed Cheese (48.3%)

Peanut Butter (2.4%)

Lunch Meat (34.8%)

Refrig./Fzn. Cakes & Pies

(3.7%)

Mayonnaise (33.9%)

Pickles, Olives, Relish (7.5%)

Meat Sauces (24.0%)

Mustard (12.6%)

Fruit Drinks (20.7%)

Shelf-Stable Dips

(8.1%)

Salad Dressing (20.5%)

Bacon (20.3%)

Cottage Cheese (20.2%)

Sour Cream (18.3%)

Nuts (17.9%)

Natural Cheese (17.3%)

Hot Dogs(19.8%)

Breakfast Meat

(14.8%)

Meat Substitute

(14.7%)

Coffee (14.0%)

Source: Food & Water Watch, Grocery Goliaths

Kraft-Heinz Conglomerate Octopus 2014

Kraft-Heinz

Dry Mac & Cheese (78.0%)

Hispanic Food

(4.5%)

Processed Cheese (54.3%)

Lunch Meat (34.8%)

Mayonnaise (33.1%)

Pickles, Olives, Relish (6.7%)

Meat Sauces (77.9%)

Mustard (10.7%)

Fruit Drinks (13.7%)

Salad Dressing (17.6%)

Bacon (18.7%)

Cottage Cheese (23.2%)

Nuts (26.1%)

Natural Cheese (17.9%)

Meat Substitute

(12.9%)

Coffee (13.5%)

CookingSauce (9.9%)

Ketchup (63.2%)

Pasta Sauce

(10.6%)

Peanut Butter (2.1%)

Spices (1.6%) Hot Dogs

(20.2%)

Frozen Appetizers

(20.1%)

Frz. Handheld

Entrée (2.6%)

Frozen Snacks (9.4%)

Source: Mintel