In it, the groups pointed to the Albertsons’ acquisition of Safeway in 2015 - after which the company awarded contracts only to its largest produce suppliers, leaving smaller farmers to sell elsewhere - as an example of the negative outcomes that can be expected with a merger of this size. In early December, the National Family Farm Coalition, National Farmers Union, Farm Action, and an assortment of regional grower associations sent a letter to the Federal Trade Commission (FTC) expressing their opposition to the merger, which they said would “create a new mega-grocery buyer with exceptional buyer power to squeeze its suppliers, shrinking farmers’ and workers’ share of the food dollar.”Ī few weeks later, a host of grower associations representing farmers in the Western U.S., where the merger could cause conflicts with overlapping markets - Western Growers, the California Fresh Fruit Association, and Colorado Fruit & Vegetable Growers Association - submitted an additional letter to the FTC. Sounds nice, but farm groups aren’t buying it. grocery market share, second only to Walmart, which captures $1 out of every $3 spent at American grocery retailers.Īccording to Kroger’s official statement, the merger is expected to enhance competition, “relieve the inflationary pressures facing shoppers,” and further advance the company’s mission by “expanding our footprint into new geographies” and providing “fresh and affordable food” options. Combined, the retailers would account for 15.6% of the U.S. Albertsons - whose subsidiaries include Acme Markets, Kings, and Safeway - is the fourth-largest, after Costco. Kroger, which operates grocery banners such as Ralphs, City Market, Harris Teeter, and others in 35 states, is the country’s second-largest grocery. In October, the Kroger Company agreed to buy Albertsons for $34.10 per share, for a deal valued at about $24.6 billion. But why are farmers and farmworkers so concerned? A growing group of agriculture associations is fighting to make their voices heard. We will just have to see.It’s easy to see why the proposed Kroger-Albertsons mega-merger would be unpopular among consumer advocates - grocery retail inflation is already high due to ongoing supply chain issues, staffing shortages, last year’s deadly avian flu outbreak, the war in Ukraine, and other erratic changes. Albertsons and Safeway merged in 2015, and a lot of the stores that were divested as part of that deal went to a company that ultimately wasn't able to stay afloat.Īnd so my point here is that you really could see workers working for stores that don't have a strong owner anymore. But there is precedent for this not working out quite that way. If they get bought by strong companies, that might work out well. They could be sold to other buyers.īut the bottom line is, in terms of what would happen to workers, it depends where those stores go. They proposed a company that would take on those grocery stores. So, as part of this divestiture kind of strategy that the FTC would be using to evaluate and ultimately perhaps approve some kind of a merger here, what you will see is potentially hundreds of stores, maybe more - it depends how it all works out - getting sold by Kroger and Albertsons to somebody else. So, what we're going to be seeing happening is, in market by market, regulators are going to be looking and seeing, how much overlap is there? How much competition would be lost if the grocery stores that Kroger and Albertsons own happened to be under the same roof? And the reason for that is that the federal government, probably the Federal Trade Commission, will get very deeply involved in what the new company would look like once the deal goes through. So, Kroger and Albertsons have said this probably could take until 2024 to close.
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