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- Summer 99 "Update" Article -
From the director
Who will chart course for 21st century agriculture?
From CATI Publication #9907001
Copyright © 1999. All rights reserved.
We discussed the need for a state and/or national agricultural industry strategic plan in the CATI spring Update newsletter. This Update, we will explore this writer’s vision of the probable California agricultural landscape changes through the next half-century or so. The only undisputed given when discussing this topic is that it will look different, probably very different. Therefore, since only weathermen and economists have the luxury of consistently making wrong predictions prior to this writing, I consulted with colleagues whom I hold in high regard both from the educational community and the industry. Surprisingly, they agreed in part or in total. So here goes.
H.G. Wells once wrote, "those who ignore history are doomed to repeat it." Therefore, before glancing into the agriculture crystal ball, it’s probably a good idea to consider events and realities of at least the recent past and the likely catalysts that will most significantly impact future change. For the most part, the catalysts are pretty well known. Some are so new they almost seem like science-fiction, but most are predictable and manageable while yet others are really based on value judgments. Which stakeholders’ values are used in developing a strategic plan and/or public policy becomes a significant issue in and of itself (topic for a different discussion) and predisposes very different outcomes.
It is important to understand that change itself is not necessarily a bad thing and that a single action alone rarely causes meaningful change. Rather, change is brought about by the long-term cause and effect reaction between all the influencing catalysts. Having said that, however, some are more influential than others. The three most significant of these in the western United States are well known to most Californians. They are water, water and water - agricultural water, urban water and environmental water. Land use planning, population growth, environmental restoration, bioengineering, food safety, food security, air quality, expanding export markets and continuously changing consumer preferences will also dominate the 21st Century agricultural forefront. But, in the end, water policy is king in California and the western United States.
The State’s rapidly increasing population, especially in the Central Valley, and the general public’s continued acceptance of environmental restoration will progressively intensify the competition for the state’s limited developed water and developable land. The resulting supply/demand pressures will progressively drive up the price of both and inevitability out of profitable reach for the production of many traditional commodities. Add to this the additional costs of a proliferation of new regulatory requirements, downward commodity price pressure from domestic surpluses and cheap imports and continuously changing consumer preferences and expect the industry to aggressively pursue higher margin alternatives. There will be a slow but increasing industry migration to high-value high-risk permanent plantings, vegetables and genetically engineered crops. Producers will also become more vertically integrated in order to capitalize on value-added processing profits and to maintain quality control of their products from field to consumer. They will become marketers of single-serving-size consumer products rather than bulk commodities.
Change of this magnitude will certainly impact the economic capability of small, medium and large size farms. Each will survive, at least if we use the USDA’s definition of a farm. However, clearly a relatively small portion of large and medium size farms will produce the preponderance of food and fiber on less land. What each farm will produce and how they will produce and market their products will differ significantly.
Small farms may increase in number somewhat and will fall into two basic classifications: very labor intensive specialized high-value truck crops marketed directly in local markets by extended families or farms, which are, in essence extended rural residential home sites substantially supported by off-farm income. Generally, medium-sized farms will continue to diminish in numbers and be more vulnerable to cost price squeezes and diminishing returns. Their need to capitalize on value-added processing and marketing returns will kindle an increased interest in processing and marketing cooperatives and/or limited liability partnerships to generate economies of scale while controlling individual members’ financial risk and maintaining their respective independence. Large farms will become progressively fewer in number and larger in size as well as more independently vertically integrated.
The good news is that, while California agriculture may look very different by the end of the next half-century or so, it will survive, it will be vibrant and it will provide tremendous opportunity on and off the farm for the next generation of agriculturists. A basic industry strategic plan could be significantly helpful in charting a course, marking milestones, and providing for necessary plan adjustments. What do you think?
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Copyright © 2000. All rights reserved.
CALIFORNIA AGRICULTURAL TECHNOLOGY INSTITUTE - CATI
College of Agricultural Sciences and Technology
California State University, Fresno