July 17, 2019

Megatrends affecting farmers – AG Week

The core of North America (including the Dakotas and Minnesota) and the core of Asia (Ukraine to Siberia) are far from the oceans and have the highest climate variations on the planet, with extreme wet and dry cycles.

In the past 20 years, precipitation has increased about 25 percent in North Dakota, says Daryl Ritchison, interim director of the North Dakota Agricultural Weather Network. Precipitation has been in the 20 to 25 inches per year range, versus the 15-20 inch range in the previous 80 years.

This has allowed farmers to shift to corn, which requires more moisture, but if rainfall declines by 3 to 4 inches per year, that would be very significant. Ritchison says heavier rain also leads to heavier weather amounts during the period.

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In the past, wet cycles have lasted 15 to 25 or even 30 years, Ritchison says. The past three or four years have dried some, perhaps returning to weather that happened from 1910 and 1992.

The Red River Valley climate historically has gone through periods as dry as Dickinson, N.D., so variability is more ordinary than perceived. “Nothing that is occurring today hasn’t occurred in the past,” he says

Joel Ransom, a North Dakota State University Extension agronomist, who specializes in cereal crops including wheat and corn, says some data suggests a longer growing season, and more variability at the start and end of the growing season, but it isn’t something farmers can easily predict. “Farmers that are agile, well-informed and have Plan Bs to deal with the kind of variability we have in our weather is going to be really important to their sustainability and profitability,” Ransom says.

2) Geopolitics. The U.S. political climate is increasingly influenced by urbanization of the Congress and the shift of rural representation toward more conservative, Republican hands. Despite this — defying perennial predictions — Congress has repeatedly passed multi-year farm policy bills, important for the “stabilization” of farm income.

The Northern Plains historically has depended more heavily on raw commodities production, marketing and exports. The region’s relatively small processing industry typically takes products to an ingredient stage.

“As U.S. agriculture has become more productive, able to out-produce the demands domestically, we have to look to the world market as an outlet for the extra production we have in the U.S.,” says Frayne Olson, an NDSU Extension Service grain marketing specialist. Producers in this part of the world have been able to capitalize in shipping to foreign markets that are newly developing and in search of raw products or ingredients.

This makes farmers more dependent on world trade and agriculture is not the primary driver of trade disputes. U.S. agriculture has usually been a winner in trade, producing commodities efficiently with higher quality than countries with which it trades.

As they grow more dependent on trade, U.S. farmers are more vulnerable to trade wars. Among the international changes affecting farmers include: a.) a permanent shift of Chinese dependance toward agricultural production from Africa, Brazil and Ukraine, and development of its New Silk Road economic strategy to develop east-west rail trade along the original Silk Road that was important for moving spices centuries ago. b.) resilience of trade between the U.S. and Canada and Mexico; c.) a rise in Brazilian agricultural trading power, as China invests in that country’s agricultural production, processing and export infrastructure; and d.) the rise of agricultural production in Africa, where China has become a bigger investor.

3) High-tech agriculture. There are myriad high-tech opportunities for agriculture in coming years. The ones with the most immediate, tangible economic opportunity so far have been auto-steer, yield mapping, and data-driven variable-rate spraying or fertilizer application.

Genetically modified organisms have allowed science to come up with novel ways to make crops tolerant to certain herbicides. This has led to “stacked traits” that have allowed farmers to cope with multiple herbicide-resistant weeds or both weeds and pests. But the varieties stacked traits require higher degrees of management and off-target applications can have unwanted effects, along with uncertain compensation for those affected. Another big impact is coming from CRISPR, short for “clustered regularly interspaced short palindromic repeats,” a gene editing capacity that subtracts parts of genetics for certain effects.

Digitization and robotics are high-tech farming tools just emerging — promising, but sometimes “overwhelming,” says John Nowatzki, an NDSU Extension agricultural machinery systems specialist. Autonomous tractors and sprayers have not caught on here — yet — but he expects 5 percent of farmers to try unmanned grain cart technology in the next year or two.

Nowatzki works with drone technology and research, as well as all of the digital data collection, storage and analysis. “The things that can provide return-on-investment are adopted,” he says. The quickest was the elimination of costly spray and tillage overlaps.

Nowatzki says using yield data has taken more office work than expected. “Lots of people collect yield data, but they’re not using it in large numbers,” he says. Combining digital data as a decision-aid isn’t moving fast.

About one-third of farmers own drones and use them for surveying crop damage, according to a Nowatzki survey in 2018. “As farms get larger and farmers acquire more land that they’re not familiar with, the data will be more important,” Nowatzki says. Today, he says, only 1 percent or 2 percent of farmers are fully using digital data for decision-making. He said he thinks the larger farmers will adapt sooner, but issues of data ownership and privacy issues will become a bigger concern, he says.

4) Consumer influence. Only 1 percent of Americans are in farming. This leaves consumers less connected to the land and farming realities. At the same time, technology allows consumers increased, unpredictable influence on markets and farming practices.

Consumers form opinions about farm management, ranging from the use of GMO feed to animal welfare to antibiotic use. Nearly a third of all food today is labeled with at least one transparency claim. says Ben Laine, senior economist for the dairy sector at CoBank.

While trends toward vegetarian or vegan food consumption grab headlines, meat consumption in the U.S. is rising. One reason is that U.S. meat prices are half the price of most places in Europe. Meat is cheaper there, but wages are lower so fewer consumers there can afford it. Americans are eating more meat than ever. Large processing enterprises that fit into large distribution chains. Premium consumers are showing increased interest in artisan-style cheese or beer, and direct contact with producers.

On the distant horizon include such concepts as artificial meat or plant-based protein sources that could have an impact on preferences toward traditional livestock agriculture.

Julie Garden-Robinson, an NDSU Extension Service nutrition and food safety specialist, says consumers are trending toward “flexitarian and plant-based diets.”

Nutritionists tend to promote diets that include variety, balance and moderation. People are trying to cut fat and calories, but labeling hasn’t had as big an impact on buying as expected. “There’s a great deal of confusion, and so much in the world of social media—Twitter, Facebook and Instagram— and they’re greatly influenced by all the information around them, and confused in many ways,” she says.