Agriculture in the United States is currently undergoing dramatic transformation.  This transformation can be attributed to rapidly improving technologies, developments in
biotechnology, and concentration in production agriculture and  agribusiness.   These
developments create opportunity and questions about concentration and antitrust, but also new challenges in the regulation of unfair and deceptive business practices,  and identifying the best policies to address these issues.

 This Committee has examined concentration and biotechnology issues in previous hearings.  The antitrust implications of consolidation and concentration in production agriculture and agribusiness are numerous.  Situations of monopoly or monopsony can easily result from reduction in the number of market participants or an increase in the market share of  the participants.  New technology and mergers have resulted in only a few large agribusinesses in the biotechnology area.  The proposed merger  between Cargill and Continental Grains has implications for domestic storage, transportation of grain, and international trade.

 The first panel will focus on these concentration and antitrust issues.  Joel Klein, Assistant Attorney General of  the Antitrust Division of the Justice Department will discuss how  the Department of Justice analyzes proposed mergers, particularly in the context of agribusiness.  He may also comment on the Cargill-Continental merger, to the best of his ability, due to the pending consent decree.

 Michael Dunn, Under Secretary for Marketing and Regulatory Programs at the
Department of Agriculture, will testify about the policy and regulatory implications of
concentration in agribusiness and production agriculture from a USDA perspective.   Concentration in grain storage, transportation, and livestock production and slaughtering are of particular interest.  We will also examine authorities of the Secretary under the Packers and Stockyards Act.  We also welcome Mr. James Baker, Administrator of the Grain Inspection, Packers and Stockyards Administration, who is present to respond to questions.

 Today’s second panel will focus on the retail sector of agribusiness.  Specifically, the panel will focus on  the retail price spread, the difference between retail grocery prices for various foods, and the prices farmers receive.  The combination of these factors has
resulted in a reduction in the farm value share of the value of the processed commodity.

 I now welcome Senator Dorgan who has some remarks before our first panel.