This study addresses changes in the organization of the U.S. pork industry, most notably marketing contracts between packers and producers, by exploring their function in addressing pork quality concerns. A number of developments brought quality concerns to the forefront. These include health concerns and corresponding preferences for lean pork, a decline in other quality attributes, heightened concerns over food safety and related regulatory programs, and expansion into global markets. Organizational arrangements can facilitate industry efforts to address pork quality needs by reducing measuring costs, controlling quality attributes that are difficult to measure, facilitating adaptations to changing quality standards, and reducing transaction costs associated with relationship-specific investments in branding programs.
Diverse needs and preferences across the United States provide justification for the devolution, or decentralization, of many Federal Government programs to the State or local level. The move toward devolution, however, has not been evidenced in U.S. agricultural policy, despite significant differences across States in such areas as commodity production, production costs, income distribution, and opportunities for off-farm work. The existing structure of USDA funding and program delivery already reflects an appreciation of the gains from devolution, with some programs accommodating differences in State and regional preferences. This report considers the implications of devolving $22 billion in 2003 budget outlays, mostly for domestic commodity and natural resource programs and rural development and housing programs. The local knowledge of needs and preferences is valuable and can provide the basis for increased program efficiency.
This report estimates the impact that high levels of enrollment in the Conservation Reserve Program (CRP) have had on economic trends in rural counties since the program's inception in 1985 until today. The results of a growth model and quasi-experimental control group analysis indicate no discernible impact by the CRP on aggregate county population trends. Aggregate employment growth may have slowed in some high-CRP counties, but only temporarily. High levels of CRP enrollment appear to have affected farm-related businesses over the long run, but growth in the number of other nonfarm businesses moderated CRP's impact on total employment. If CRP contracts had ended in 2001, simulation models suggest that roughly 51 percent of CRP land would have returned to crop production, and that spending on outdoor recreation would decrease by as much as $300 million per year in rural areas. The resulting impacts on employment and income vary widely among regions having similar CRP enrollments, depending upon local economic conditions.
U.S. consumption of food commodities is projected to rise through the year 2020, mainly due to an increase in population. But the mix of commodities is expected to shift because of an older and more diverse population, rising income, higher educational attainment, improved diet and health knowledge, and growing popularity of eating out. This study analyzes data from USDA's food consumption survey to project the consumption, through the year 2020, of 25 food groups and 22 commodity groups. Per capita consumption of fish, poultry, eggs, yogurt, fruits, nuts and seeds, lettuce, tomatoes, some other vegetables, grains, and vegetable oils is predicted to rise, whereas consumption of beef, pork, other meat, milk, cheese, potatoes, and sugar is expected to fall. The growth of the at-home and away-from-home markets varies from one commodity to another. Fruit consumption is expected to lead all commodities in growth in the at-home market, and fish consumption is expected to lead in growth in the away-from-home market.
Although earnings generally increased in rural areas in the 1990s, Hispanic population growth led to lower wages for at least one segment of the rural population- workers with a high school degree (skilled workers), particularly men in this skill group. Using data from the Bureau of Economic Analysis and the Current Population Survey, this report examines the effects of Hispanic population growth on rural wages. The analysis combines approaches from earlier immigration-impact studies and more recent work that incorporates the role of labor demand in the labor market. The analysis finds that labor demand shift factors and other area-specific factors that often are not included in immigration studies are important. Results indicate that labor demand increases favored skilled workers (those with a high school degree) overall but favored unskilled and professional workers in some rural industries. Thus, the increased supply of unskilled labor from Hispanic population growth led to lower wages for skilled men as a result of production changes in some parts of the rural economy.
Nutrients from livestock and poultry manure are key sources of water pollution. Ever-growing numbers of animals per farm and per acre have increased the risk of water pollution. New Clean Water Act regulations compel the largest confined animal producers to meet nutrient application standards when applying manure to the land, and USDA encourages all animal feeding operations to do the same. The additional costs for managing manure (such as hauling manure off the farm) have implications for feedgrain producers and consumers as well. This report's farm-level analysis examines on-farm technical choice and producer costs across major U.S. production areas for hauling manure to the minimum amount of land needed to assimilate manure nutrients. A regional analysis then focuses on off-farm competition for land to spread surplus manure, using the Chesapeake Bay region as a case study. Finally, a sectorwide analysis addresses potential long-term structural adjustments at the national level and ultimate costs to consumers and producers.
In response to energy security concerns, alternative energy programs such as biomass energy systems are being developed to provide energy in the 21st century. For the biomass industry to expand, a variety of feedstocks will need to be utilized. Large scale production of bioenergy crops could have significant impacts on the United States agricultural sector in terms of quantities, prices and production location of traditional crops as well as farm income. Though a number of scenarios were examined to study the impact of bioenergy crop production on the agricultural sector, two cropland scenarios are presented in this report. Under the wildlife management scenario, the analysis indicates that, at $30/dry ton (dt) for switchgrass, $31.74/dt for willow and $32.90 for poplar, an estimated 19.4 million acres of cropland (8.2 million from CRP) could be used to produce 96 million dry tons of bioenergy crops annually at a profit greater than the profit created by existing uses for the land. In this scenario, traditional crop prices increase from 3 percent to 9 percent (depending on crop) and net farm income increases by $2.8 billion annually. At $40/dt of switchgrass, $42.32/dt for willow and $43.87/dt for poplar and assuming the production management scenario, an estimated 41.9 million acres (12.9 million from CRP) could be used to produce 188 million dry tons of biomass annually. Under this scenario, traditional crop prices increase by 8 to 14 percent and net farm income increases by $6 billion annually.
Retail consolidation, technological change in production and marketing, and growing consumer demand for produce have altered the traditional market relationships between producers, wholesalers, and retailers. Increasingly, produce suppliers are asked to provide additional marketing services and incentives in exchange for volume purchases and other commitments by buyers. This report synthesizes the results from a multiphase project that examined the dynamics of produce marketing, the produce shipper-retailer relationship, and how changes in the produce market affect the relative market influence of producers, retailers, and consumers.
Rapid change in the size and ownership structure of U.S. hog production has created new and varied challenges for the industry. This report describes an industry becoming increasingly concentrated among fewer and larger farms, and becoming more economically efficient. These changes have not come without problems. The increasing market control and power concentrated among packers and large hog operations, and the manure management problem posed by an increasing concentration of hog manure on fewer operations, are paramount concerns. Addressing these concerns through regulations would likely impose economic costs that could be passed on to consumers. In addition, the relative mobility of the hog industry means that regulations could result in significant changes in the location of hog production facilities, with ripple effects in local economies. Balancing environmental and economic interests will challenge policymakers dealing with the implications of structural change in U.S. hog production.
By 2020, the effects of demographic changes and income growth will increase per capita spending on food 7.1 percent. Income growth alone, which will effect spending increases of almost 10 percent on away-from-home foods and 3 percent on at-home foods, will raise per capita food spending about 6 percent. Expansion of the Nation's population will drive growth in food demand and, combined with rising incomes and other demographic changes, is projected to boost total U.S. food spending 26.3 percent. On a national level, the slow but steady growth of the population will result in little variation among expenditure growth levels of individual food groups. The largest projected increase is for fruits, up 27.5 percent, while the smallest is for both beef and beverages, up 21.1 percent.
Agricultural policy is rooted in the 1930s notion that providing transfers of money to the farm sector translates into increased economic well-being of farm families. This report shows that changes in income for the farm sector or for any particular group of farm businesses do not necessarily reflect changes confronting farm households. Farm households draw income from various sources, including off-farm work, other businesses operated, and increasingly nonfarm investments. Likewise, focus on a single indicator of well-being, like income, overlooks other indicators such as the wealth held by the household and the level of consumption expenditures for health care, food, housing, and other items. Using an expanded definition of economic well-being, we show that farm households as a whole are relatively better off than the average U.S. household, but that about 6 percent remain economically disadvantaged relative to the rest of the population.
Public amenities provided by a rural agricultural landscape, arising from open space and farm activity, are important to many citizens and policymakers. Widespread development of farmland in some parts of the country has spawned an expanding array of farmland protection programs by county, State, and Federal governments, as well as by nonprofit organizations. To investigate the relative importance of preserving different amenities, this report examines the enabling legislation of these programs across the 48 contiguous States, and the implementation of these programs in five Northeastern States (Maryland, Massachusetts, New Jersey, Pennsylvania, and Vermont). The report also assesses how farmland protection programs fit into the broader array of rural land conservation programs.
More Americans are eating hamburgers more well-done than in the past, according to national surveys. This change reduced the risk of E. coli O157:H7 infection by an estimated 4.6 percent and reduced associated medical costs and productivity losses by an estimated $7.4 million annually. In a 1996 survey, respondents who were more concerned about the risk of foodborne illness cooked and ordered hamburgers more well-done than those who were less concerned. However, respondents who strongly preferred hamburgers less well-done cooked and ordered them that way, even after accounting for their concern about the risk of illness.
This report focuses on recent trends in the food supply chain. Chapters on food manufacturing, wholesaling, grocery retailing, and food service provide a detailed overview of structure, performance, information systems, new technology, and foreign direct investments. The report also contains a comprehensive set of appendix tables containing sales, concentration, trade, productivity, and other indicators. At the time of publication, most of the data sets used in this report included data through the year 2000.
Use of crop biotechnology products, such as genetically engineered (GE) crops with input traits for pest management, has risen dramatically since commercial approval in the mid-1990s. This report addresses several of the economic dimensions regarding farmer adoption of bioengineered crops, including herbicidetolerant and insect-resistant varieties. In particular, the report examines: (1) the extent of adoption of bioengineered crops, their diffusion path, and expected adoption rates over the next few years; (2) factors affecting the adoption of bioengineered crops; and (3) farm-level impacts of the adoption of bioengineered crops. Data used in the analysis are mostly from USDA surveys.
Studies conducted since the late 1970s have estimated the net energy value (NEV) of corn ethanol. However, variations in data and assumptions used among the studies have resulted in a wide range of estimates. This study identifies the factors causing this wide variation and develops a more consistent estimate. We conclude that the NEV of corn ethanol has been rising over time due to technological advances in ethanol conversion and increased efficiency in farm production. We show that corn ethanol is energy efficient, as indicated by an energy output:input ratio of 1.34 and 1.53 under a best-case scenario.
The economic development of South Korea is often considered a model for developing countries. We use 1975 and 1990 data in a general equilibrium framework with a highly disaggregated sector specification to evaluate the opportunity cost of its agricultural protection. We show that although agriculture's share of the gross domestic product (GDP) declined between 1975 and 1990, the cost of agricultural protection, as measured by the loss in GDP, did not fall. The larger gap between domestic and world prices for the protected sectors exacerbated the distortions in resource allocation. Simulated removal of 1990 agricultural border protection reduced the share of agricultural GDP to the level actually observed in 1996, demonstrating how protection can impede economic structural development. The public policy implication is for developing countries to adopt policies that help the agricultural sector become competitive. Otherwise, as in Korea, the resource costs of delaying adjustment grow over time.
The Government of Mozambique (GoM) is attempting to pursue an integrated development policy which will both attract investment capital and increase local income, finances and new structure organization. The Land Policy and land Administration, more that social issue is today a economical issue oriented to the market, and is included in political agenda of the Government. The emphasis is driven to take overview of the future as important tools of the economic growth and development.
