Seven Things to Think About in Agriculture 2009

 

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  1. It isn't about acreage or animals, it's about profits.
  2. It's also about debt.
  3. Be involved in social and political issues; be there when and where decisions are made, like the courthouse, the statehouse and the Capitol.
  4. Agricultural producers will face increased accountability for food safety and increased responsibility for the environment.
  5. Fueling the future will stay hot. If you can be involved in the production of energy (wind, methane digestion, solar, bio-based), go for it.
  6. Food is no longer a commodity.
  7. This is a good year for lifelong learners to refine and reflect.

Participants

Dr. Bill R. Baumgardt
Mr. Horace Paarlberg
Mr. James R. Moseley
Dr. Henry Wadsworth
Mrs. Barbara A. Reif
Capt. Sarah J. Watlington, USN, Ret.
Dr. Marion F. Baumgardner
Dr. Chris J. Johannsen
Dr. Lewis J. Runnels
Dr. George W. Thrasher
Dr. William W. McFee
Mr. William G. McVay
Heather Bradford
Megan Furey
Melissa McDonald
Betheny Moore
Megan Rumpke
Lisa Schluttenhofer
Emily Stone
Shalyse Tindell
Amy Winter

Purdue Agriculture had a unique opportunity this winter to bring together a group of bright people, all interested in agriculture but coming to it from the far ends of the career spectrum. You will recognize the names of the retirees, faculty and alumni who participated and I'm sure you will see the names of the beginning honors students again in future forums.

What follows is our highly educated guess on some of the things that people who make their living in agriculture need to think about in 2009.

Good Fortune
— Dale Whittaker, Associate Dean and Director of Academic Programs

The Drivers of Change

Participants say the dominant drivers of change for U.S. agriculture will be an uncertain economy and the change in the federal administration, with the potential to affect everything from regulatory oversight to the political approach to food and food production. Globalization brings more competition, more opportunities for growing specialized crops, new markets, along with an informed public and the potential for catastrophic animal and plant diseases. An increase in consumer interest and advocacy will continue to affect production methods and the application of modern genetic tools and other technologies. Food safety, or the lack of it, will always be a driver. Science may or may not be a factor in influencing public perception or government regulation, especially in animal agriculture, says the panel.

Seven Things to Think About in Agriculture 2009

  1. It isn't about acreage or animals, it's about profits.
    Corn isn't going to have an advantage over soybeans in 2009, so expect to see fewer corn acres. Inputs for soybeans are cheaper, and as long as oil is down around $60/barrel, corn-based ethanol doesn't appear very attractive.

    Keep an eye on meat production. In 2008 we've had record liquidation of meat worldwide, and a reduction in production due to the high cost of feed. However, worldwide demand for meat is, in general, growing, especially in developing countries.

  2. It's also about debt.
    Land prices will drop, but this year borrowing to buy won't make sense. Producers and businesses with little debt are going to benefit by the summer and fall of 2009, with opportunities to buy land and machinery.

    Structure your long-term interest rates; convert to 30-year and 20-year notes. Don't go for variable interest rates. Tear up your credit cards.

  3. Be involved in social and political issues; be there when and where decisions are made, like the courthouse, the statehouse and the Capitol.
    The Environmental Protection Agency or the Office of Management and Budget will have more influence over agriculture than USDA this year.

    Pay attention to what's happening in state and national politics, but get involved locally. Focus on cooperation as you serve or connect with national government, state government, county councils, county commissioners, or community government. Get invited to meetings if you're not a member.

    Return on civic investments may be higher for non-farm organizations. Help other people in the community understand the issues.

  4. Agricultural producers will face increased accountability for food safety and increased responsibility for the environment.
    Expect more new rules and an increased emphasis on some old ones. There will be more recordkeeping.

    Anticipate new regulations surrounding animal production, especially on animal well-being, air quality and waste treatment. Some methods of animal confinement are already off the table, and not because of federal rules.

    New rules regarding air quality are a certainty. EPA has been looking at air and holding off on decisions until after the change in administration.

    Look for owners of smaller operations to struggle or leave farming. While the image of large farms is not good, they will be able to meet the new regulations. Those same regulations will put more pressure on small farms.

  5. Fueling the future will stay hot. If you can be involved in the production of energy (wind, methane digestion, solar, bio-based), go for it.
    Corn-based ethanol isn't big in our future unless oil prices rise drastically again. Other plants may have more potential. Windmills are on the horizon for many more communities.

    People with land, trees, or crops should investigate carbon-banking.

  6. Food is no longer a commodity.
    Expect growing sales of organic, slow, natural, local, and green foods in the wealthier segment (top 40%) of the population. More people want to know who produced their food and how; some want to have a relationship with the producer, all of them expect high levels of quality and safety.

    If commodities you produce are connected with obesity or diabetes, you may be less likely to get a government subsidy.

  7. This is a good year for lifelong learners to refine and reflect.
    For example, a focus on soil fertility can keep costs down and reduce pollution. Prices of phosphorus and potassium are based on international demand; prices of nitrogen are tied to oil prices. Less fertilizer on the ground means a reduced chance of nutrient pollution of groundwater and surface water. Government programs are up for an overhaul. Seed genetics are changing rapidly, too, which means more variables for insect control, fertility, and other inputs. Farmers and their suppliers will be going back to school.

About the Project

Purdue Agriculture's new Steve and Sandra Hageman Center for Student Achievement and Leadership was the setting for a futuring exercise featuring a unique set of participants. Purdue Agriculture alumni and retired professors joined freshman students from the Dean's Scholars Learning Community to discuss trends and implications for farmers and agricultural businesses in 2009.

It was an intense afternoon of learning, teaching, sharing perspectives and building consensus. People who know farming down to the granular level of soil and grain listened to people who represent the views of those who affect farming from the grocery check-out stand, and vice versa.

Participants voted on the foremost future implications they think people in the business of farming and agriculture will need to pay attention to in the coming year.