The Grain Barons

by Austin Frerick

Listen to host Mary Swander interview Austin Frerick about his new book Barons on Mary Swander’s Buggy Land podcast:

Read an excerpt from Chapter 2 from Barons: Money, Power, and the Corruption of America's Food Industry by Austin Frerick. Copyright © 2024 Austin Frerick. Reproduced by permission of Island Press, Washington, D.C..

Photo by Kelly Sikkema on Unsplash

There is a template for the all-American business success story. An immigrant family comes to the United States with little more than two pennies to their name, opens a business, and works hard year after year. As the family members slowly build the business, successive generations take on the responsibility of running and growing it. The business prospers, and its leaders become prominent citizens, giving back to the community that helped them succeed. Museums, schools, and hospital wings soon bear their names.

The Cargill-MacMillan family, which owns Cargill, Inc., has told this story about its centuries-old business for decades now. William Duncan MacMillan, who served on the company’s board of directors for over thirty years, published three books chronicling its saga, and the family even hired an Ivy League professor to write a three-volume version that spans over 1,800 pages. [1]

One aspect of Cargill’s all-American narrative rings true: the corporation remains a family-owned business. In fact, for its size and age, Cargill has kept its ownership remarkably close. Today, nearly one hundred members of the Cargill-MacMillan family control about 90 percent of the company’s shares. [2]

But Cargill is no ordinary success story. The company has grown and grown and grown, well beyond the bounds of the humble-family-business-made-good narrative. It is now the largest private company in America, larger even than the infamous Koch Industries. [3] For perspective, Cargill’s annual revenue is equivalent to the combined annual state tax revenues of South Dakota, New Hampshire, Montana, North Dakota, Vermont, Rhode Island, Delaware, Maine, West Virginia, Idaho, Nebraska, New Mexico, Hawaii, Mississippi, Nevada, Oklahoma, Kansas, Arkansas, and Iowa. [4]

It's hard to pin down exactly how big Cargill is because, as a private company, it is not required to disclose its finances. In fact, Cargill produced public figures for the first time in 1969 only because Harvard Business School required it for an award it gave the company. [5] Nor is it easy to grasp the scope of Cargill’s empire. The company employs over 160,000 people worldwide and operates in a seemingly endless list of industries, from salt to cocoa. [6] There’s a good chance that some, perhaps most, of the ingredients of an average American meal were processed and sold by Cargill. The company likely transported most of the ingredients, too, via its massive shipping network.

To get a sense of how Cargill touches most aspects of the American food system, take it from one of the company’s own brochures:

We are the flour in your bread, the wheat in your noodles, the salt on your fries. We are the corn in your tortillas, the chocolate in your dessert, the sweetener in your soft drink. We are the oil in your salad dressing and the beef, pork or chicken you eat for dinner. We are the cotton in your clothing, the backing on your carpet and the fertilizer in your field. [7]

Photo by Mike on Unsplash

But despite the breadth of products and services that Cargill provides, I like to refer to the Cargill-MacMillan family as the Grain Barons. After all, the company’s core business lines—food ingredients, shipping, animal feed, butchering, and financial services—revolve around a handful of commodities, especially corn and soy. Even the company’s ancillary products, such as soybean candle wax, are derived from these crops. Although soybeans are technically a legume, not a cereal grain, they are often lumped in with corn as a “coarse grain” because of their similar role in the modern food system. [8]

Taken together, Cargill handles more than one-quarter of the world’s grain trade. [9] Yet despite this dominance, the company is largely unknown to most Americans. I certainly never grasped its true size, even though it has been a constant backdrop in my life. I grew up in Cedar Rapids, Iowa, an industrial city in the eastern part of the state that forms a key cog in corn and soybean processing. I was born near a Cargill soybean mill and went to church near a Cargill corn mill. I even played soccer next to a Cargill grain elevator.

But as much as my physical surroundings, Cargill shaped the food that I grew up eating. In the late twentieth century, the American food system began to revolve around the processing of the same grains—corn and soy—on which Cargill has built its empire. Cargill’s power is illustrated by the fact that it’s easier to get a healthy, locally sourced meal in Washington, DC, or New York City than it is in my home state of Iowa, surrounded by some of the world’s most productive agricultural land. [10]

This profound shift in the American diet can be traced back to a dramatic reconceptualization of the Farm Bill and the food policy in the United States. These same changes helped fuel Cargill’s transformation from a robust family-owned business into the behemoth it is today. As a result, the story of Cargill is inextricably linked to the history of the US Department of Agriculture and, more specifically, to the development of what I call the “Wall Street Farm Bill.”

Austin Frerick Bio: 

Austin Frerick is an expert on agricultural and antitrust policy. He worked at the Open Markets Institute, the US Department of Treasury, and the Congressional Research Service before becoming a Fellow at Yale University. He is a graduate of Grinnell College and the University of Wisconsin-Madison.

Notes from Chapter 2 of Barons:

[1] W. Duncan MacMillan, “Minneapolis Star Tribune, November 2, 2006, https://www.startribune.com/obituaries/detail/8861738/; Wayne G. Broehl Jr., Cargill: Trading the World’s Grain (Hanover, N.H: Dartmouth College Press, 1992); Wayne G. Broehl Jr., Cargill Going Global (Hanover, NH: Dartmouth College Press, 1998), Wayne G. Broehl Jr., Cargill: From Commodities to Customers (Hanover, NH: Dartmouth College Press, 2008).

[2] Sarah Reid, “Inside the Cargill Family,” Creaghan McConnell Group, June 14, 2019, https://cmgpartners.ca/cargill/.

[3] Andrea Murphy, “America’s Largest Private Companies 2022: Twitter and Continental Resources Join the Ranks,” Forbes, December 1, 2022, https://www.forbes.com/sites/andreamurphy/2022/12/01/americas-largest-private-companies-2022-twitter-and-continental-resources-join-the-ranks/?sh=1c28b3ca34c7.

[4] Statista, “State Government Tax Revenue in the United States in the Fiscal Year of 2021, by State (in Billion U.S. Dollars), April 2022, https://web.rchive.org/web/20220720014457/https://www.statista.com/statistics/248932/us-state-government-tax-revenue-by-state/; Cargill, Inc., “Cargill at a Glance,” accessed May 31, 2021, https//www.cargill.com/about/cargill-at-a-glance.

[5] Seth S. King, “It’s Said, ‘The Sun Never Sets on Cargill,’” New York Times, September 25, 1972, https://nyti.ms/3Ek4Y48, http://timesmachine.nytimes.com/svc/tmach/v1/refer?pdf=true&res=9A0DEED6133FE73ABC4D51DFBF668389669EDE.

[6] Patrick Thomas, “Cargill Names Brian Sikes as Chief Executive,” Wall Street Journal, November 21, 2022, https://www.wsj.com/articles/cargill-names-brian-sikes-as-chief-executive-11669036029.

[7] Brewster Kneen, Invisible Giant: Cargill and Its Transnational Strategies, 2nd ed. (London: Pluto Press, 2002), 2.

[8] US Department of Agriculture, Risk Management Agency, “Coarse Grains: Corn, Grain Sorghum, and Soybeans,” November 2021, https://www.rma.usda.gov/en/Fact-Sheets/National-Fact-Sheets/Coarse-Grains.

[9] Yale University, “Whitney MacMillan, Longtime Friend of Yale, and Namesake of the Whitney and Betty MacMillan Center for International and Area Studies, Dies at the Age of 90,” April 1, 2020, https://macmillan.yale.edu/news/whitney-macmillan-longtime-friend-yale-and-namesake-whitney-and-betty-macmillan-center.

[10] Austin Frerick, “To Save Rural Iowa, We Need to Make Healthy Food a Right,” Slow Food USA, March 9, 2018, https://slowfoodusa.org/to-save-rural-iowa-we-need-to-make-healthy-food-a-right/.

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