USDA and Agriculture Update

The size of global agriculture has grown dramatically in recent years, in terms of both production and market value, the result of a combination of technology and growing demand for both feed and food grains, meat, and vegetables. Those results have not been evenly distributed, however.

“The U.S. has had more growth in agricultural production since 2000 than Europe, but China, on the other hand, has seen more rapid growth than the U.S. in that same time, as has Brazil, especially in grains, oilseeds, and livestock,” said Pat Westhoff, Ph.D., director of the Food and Agricultural Policy Research Institute (FAPRI) at the University of Missouri.

“A crude indicator is the value of agriculture sales, which was $192 billion in 2000 and $378 billion in 2015 for the U.S., which is a sizeable increase, even when adjusted for inflation. Part of that is due to higher prices, but also greater production. For example, we have tripled the volume of corn produced in that time, while prices have roughly doubled.”

The types of crops grown have changed little in recent decades, but the share of production has, with a greater percentage of corn and soybeans than in 2000, but less wheat, cotton, rice, and other commodities. Those changes were driven by increased demand, both domestic and international, although the reason for that demand also has changed. Until 2010, a lot of the growth in corn and soybeans was due to ethanol, but since then, it has been an increase in livestock feed production, both domestic and export. For soybeans, China has been importing ever larger volumes in recent years.

cotton field

Dry land cotton grows on a farm in Navasota, Texas, on Aug. 23, 2013. Over the past 15 years, cotton acreage planted has dropped by almost half. Credit: USDA photo by Bob Nichols

The number of acres planted in four major crops and yields have mirrored that: In 2000, U.S. corn plantings totaled about 80 million acres; in 2015, it was 88 million, having peaked at 97 million in 2012. Soybeans rose from 74 million acres in 2000 to 83 million in 2015. Wheat acreage dropped from 63 million to 55 million, and cotton from 15 million to 8 million. For the 14 crops charted by FAPRI, the total U.S. acreage planted rose from 253 million in 2000 to 260 million in 2015.

“The cotton industry has very severe challenges going forward,” he added. “Yields vary a lot from year to year – 2015, as of December estimates, showed 768 pounds per acre harvested, which is abnormally low. In 2014, it was 838 pounds per acre and about 630 pounds in 2000. We just hit a plateau the past few years, with cotton at 880 pounds or so in 2012.

“Weather and other factors have a very significant impact for almost all major commodities, with year-to-year variability. In the case of corn, the long-term trend has been an increase of a bit more than 1 percent per year, as has been the case with both wheat and soybeans.”

That variability also appears for exports. In 2014, the last year for which full data are available, the United States exported 1.864 billion bushels and production was 14.216 billion bushels. Exports were about 13 percent of production, but about 14 percent in terms of total use, adjusting for what went into storage. The share has declined in both measurements since 2000, when both use and production were at 20 percent.

Chinese officials sample soybeans

People’s Republic of China General Administration of Quality Supervision, Inspection and Quarantine (AQSIQ) officials take samples of U.S. soybeans at the Port of Dalian. Credit: USDA/FAS photo by Mark Rasmussen

For soybeans, exports in 2000 accounted for 36 percent of total use and production, compared to 47 percent of production and 48 percent of use in 2014 – largely due to China, which allowed both the United States and Brazil to increase exports. Those numbers only account for raw soybeans; when oil and meal are included, more than half of U.S. production was exported. For wheat, 2014 exports were 42 percent of use and production, down sharply from 48 percent of production and 44 percent of use in 2000.

Significant changes also were seen in meat, milk, and milk-product production and exports.

Beef production was 27 billion pounds in 2000 and 24 billion pounds in 2015, the decline in part due to drought-related herd reductions. Pork was 19 billion pounds in 2000 and 25 billion pounds in 2015, and chickens 30 billion pounds in 2000, shooting up to 40 billion pounds in 2015, reaching record levels as the nation largely moved past the effects of the drought by 2015.

Milk production also has increased sharply since 2000, from 167 billion pounds to 208 billion pounds in 2015, despite a drop in per capita U.S. consumption from 212 pounds in 2000 to 180 pounds in 2015, most of that in the last five years. Part of that was due to competition from other products, such as soy and almond milk, fewer children as a share of the population, and adults drinking less milk. Cheese consumption, on the other hand, has risen from 30 pounds per capita in 2000 to 35 pounds today. U.S. dairy exports also have changed significantly, with the nation moving from a net overall importer, especially of cheese, to a net exporter by 2014.

Recent and soon-to-be-implemented U.S. government policy changes are not having a significant impact on production, although they are important to farmers’ incomes, according to Westhoff.

cheese wheels

Cheese rounds that have been inoculated with mold and are curing in the aging room to produce Chapel’s Country Creamery “Bay Blue” cheese. The dairy produces hand-crafted artisanal cheeses with fresh raw milk produced on the dairy’s Grade A dairy farm in Easton, Maryland. In the United States, per capita cheese consumption has risen significantly. Credit: USDA photo by Bob Nichols

“We are now under the 2014 Farm Bill for the second year, which significantly changed government support for the farm sector, but still has not had a big impact on what we’re growing,” he said. “Government payments are a relatively small share of farmers’ income these days.

“In 2015, farmers earned $192 billion selling crops, $187 billion selling livestock, and received $11 billion in government payments. In 2000, government payments were more than 10 percent of total farm income. Over time, it’s more common for crop receipts to exceed livestock receipts; there was an anomaly for a few years, but we’re getting back to more traditional comparisons today.”

The rapid and extensive growth of technology, crops, and markets is expected to continue, at least through the next 20 years, as will foreign competition in export markets and domestic production in some nations and further reductions in the number of U.S. farms involved in significant crop plantings and yield and livestock production. At the 2015 Agricultural Outlook Forum Plenary Panel on Innovation, Biotechnology and Big Data, Robert Fraley, Ph.D., Monsanto’s executive vice president and chief technology officer, outlined just how dramatic that growth will be.

“There’s never been a more interesting or more important time for agriculture. I’m sure you all know the challenges: World population growing, world wealth increasing, and demand for food continuing to skyrocket,” he said. “Between now and 2050, we need to double the world’s food supply. A big part of that is going to be increased production, some will be reduced waste – which will be really important – some could be improved diets. But putting it into perspective, we have to produce more food in the next 35 years than we have in the entire history of the world.

“I believe that by 2050 we’ll see doubling the yields of the major crops we produce in North and South America, but even that will not provide adequate food security unless we see dramatic yield gains across Asia and Africa, as well. It will be really critical that Africa has the capacity to feed itself in the future. … I see Africa today much of how I would have viewed Brazil 30 years ago in terms of its potential, and I think innovation will make that difference happen.”

Harden in Africa

Agriculture Deputy Secretary Krysta Harden examines ripe cocoa pods and tours the WCF African Cocoa Initiative farm in Ghana on Nov. 16, 2015. The ability of Africa to feed itself will be critical to its future. Credit: USDA photo

Fraley predicts those innovations – phenomenal advances in biology that enable gene-by-gene recombinations of corn and tomato seeds and the ongoing infusion of data science and information technology – will create the next green revolution while improving productivity and yields.

“A lot will be a continuation of ongoing trends, with ever-increasing farm productivity,” Westhoff agreed. “New technologies will be developed and adopted. But there also are some countervailing trends in organic and local [yields] to reach markets that are skeptical of traditional agriculture. There may be cases, especially fruits and vegetables, where greenhouses and vertical marketing may grow with respect to local consumer outlets for high-value products, but I don’t think it will be a significant part of the whole.

“It’s always easier to think in evolutionary terms, although that means you may be overlooking a revolution that will then take you by surprise. I think we will learn how to use big data information and precision farming will become more and more prominent. But I’m not sure that will be a revolution. We have been part of global agriculture since the beginning of the United States, so it’s not really a new thing; what happens on the other side of the world can have significant impacts on U.S. agriculture production and sales.”

In October 2015, the U.S. Department of Agriculture’s National Institute of Food and Agriculture (NIFA) announced grants of nearly $3 million under the agency’s Critical Agricultural Research and Extension (CARE) program to develop the science to address critical issues affecting plants and animals.

“It is essential to promote partnerships between researchers, extension experts and producers to ensure the success of American agriculture,” NIFA Director Sonny Ramaswamy, Ph.D., said. “The CARE program is centered on the swift identification of problems, creation of solutions, and prevention of interruptions or issues that impact farmers’ ability to provide a safe and abundant food supply for our nation.”

Ruth MacDonald, Ph.D., chair of Food Science and Human Nutrition at Iowa State University’s School of Agricultural and Biosystems Engineering, said that kind of partnership – with the inclusion of consumers – is critical, not only for the development of future technologies and techniques, but also as part of an effort to better explain the nature of modern agriculture and food production to the general public.

“It’s an interesting dynamic right now. Nationwide we are seeing a perception that what we call ‘Big Ag’ has ruined our food system and created environmental disaster, so there is a sort of idealistic perception we should go back to the way it was in the 1950s and before, when people had little farms and raised what they needed and could sell to their neighbors,” she said. “I’m finding it challenging to understand what people think about agriculture. There is a real disconnect between what they think they want and what we can do.

“People began thinking what was labeled as organic was better. I talk to lay groups about this all the time because it is a real misconception about what food is and how we grow it and what is feasible. Everyone in agriculture today realizes we still have problems to resolve, but there is no simple fix. We’re not going to throw out high-tech agriculture and solve these problems by going back to some ancient way of doing things. We need to come together and stop trying to paint this or that technology as evil. We need to use the tools we can adopt, but also realize technology has advantages that can solve problems in a much more efficient manner. And I don’t know if that conversation is being had.”

That disconnect, if it grew to levels now seen in Europe, could significantly affect U.S. agriculture’s domestic as well as international markets.

“For the past 50 years, our society has evolved to take away the question of our food – you no longer have to think about the safety of your food or how to prepare it, you can be pretty sure you will get the nutrients you need and won’t get sick from the food you buy at a grocery store,” MacDonald said. “But now people are blaming food processing for obesity and other problems. If we all went back to not eating processed foods and making our own food, would that really solve the problem?

“It’s typical to look for the most obvious answer to any problem – in this case, Big Ag. And it certainly has had a role, but hardly the only role. A number of food processing technologies have significantly improved food quality and availability. Not that it’s perfect, but this whole idea of throwing everything out because we think it is bad is not going to be a solution we really want.”

“It is essential to promote partnerships between researchers, extension experts and producers to ensure the success of American agriculture.” — NIFA Director Sonny Ramaswamy, Ph.D.

Because of its success, she noted, U.S. agriculture has been taken for granted, which has had a negative impact on public attitudes toward something they no longer understand and to which they have no direct connection.

“I don’t know where that will end up, but I am concerned about messages being conveyed to consumers, especially about the whole organic thing coming from big chain stores and restaurants. The end result of saying you’re only going to buy organic will be to drive up prices, forcing organic producers to get bigger,” MacDonald said.

Corey Reid, senior vice president of the Intelligent Solutions Group at John Deere, told the Agricultural Outlook Forum one of the barriers – but also opportunities – faced by the agricultural industry is making it easier to integrate complex genetics developments, advanced machine operation, and health and other factors related to improving the total production system. But using feedback from users has made it “a heck of a lot easier to integrate the technologies they can use to actually go do the work.”

“We have to be able to work together to open up the system and be able to make it easy to integrate at the local level. That will require not just great machines, not just great technologies, but services from a lot of companies that can go help that integration occur,” he said.

“The drivers are simple – it’s environmental, it’s economic and every one of those producers just wants the ability to compete on an open market. They want the ability to compete on their efficiency. It’s my belief that the biggest thing we can do is make it easier to integrate.”

Agriculture Secretary Tom Vilsack added another challenge for agriculture: defining who is a farmer.

“We have a fairly expansive definition: Anyone who produces more than $1,000 worth of product constitutes, in our census, a farmer. … We have roughly 2.3 million folks who do that – roughly 2.2, 2.3 million. Of that number, 1.3 million are folks who have something in the back yard or in the back 40 that they do because they want to do it. Maybe they’re retired, maybe they enjoy it, maybe it’s something for the grandkids to do,” he said.

“That leaves about a million; of [those,] roughly 700,000 … produce less than $250,000 worth of merchandise, and those are the people that I have deep concern about … [they] are greatest at risk … because they have smaller operations and are trying to compete in a commodity-based market where it’s very, very difficult. That’s why we have made local and regional food systems a priority; it’s why we see the value-added proposition of organic being something that should be available. So you’re really dealing with commercial-sized operations – a balance of [about 300,000] – [who] produce 85 percent of what we grow. So it is important for people to understand that.”

Caption for top photo: A 12-row corn harvester transfers feed corn to a 450-bushel grain cart during the feed corn harvest at the John N. Mills & Sons farm, a family-owned business located in the Hanover and King William counties of Virginia, on Sept. 20, 2013. Corn plantings were up to 88 million acres in 2015. Credit: USDA photo by Lance Cheung