Tuesday, May 20, 2008

My Thoughts on the Montana Video

Yesterday I posted THIS VIDEO from Montana. It was produced for a conference on food production and needs that was held in 2007. I don't know what the outcome of the conference was, but I think this video provides a very compelling argument for changing the structure of our agricultural and food system. One thing that is clear to me after watching this video is that having locally produced food is not just about jobs for the farmers, but also about jobs for processors and sellers. If you haven't had a chance to watch this yet carve out ten minutes today and watch it.

Here are a few more thoughts after watching the video a couple of times:

-This video is produced by and is about Montana, but I think you could easily insert Iowa or any other mainly agricultural state and come to the same conclusions. In fact I believe a system like this would be applicable in most of our country, even some of the more populated areas ... with some differences of course.

-One of the craziest things about food in the United States is that if you grow/raise it in your state for human consumption it will most likely leave your state before it comes back to be consumed. Granted, I'm only 28 years old and only have an Associates degree ... but, that just doesn't make sense!

-In 1910 Montana farmers received 60¢ of the food dollar ... now it is 7¢!?! I have heard this statistic in various forms and have commented on it in the past, but every time I see it is just blows me away. If I was a full-on commodity farmer I think it would be enough to drive me to depression. How have we let this happen to ourselves? How can we reverse the trend?

-"A lot of times we take on risks that maybe a normal business wouldn't take on." That was the quote from the farmer in the video. Yet, if you want to farm outside of conventional wisdom it is considered crazy?

Those are just some of my thoughts on the farming side of the video. I could go on and I do have some thoughts on the consumer side, but I think this is enough for today because it does have me stirred up. Watch the video! And then let us know what you thought.

5 comments:

Dave_Flora said...

"-In 1910 Montana farmers received 60¢ of the food dollar ... now it is 7¢!?! I have heard this statistic in various forms and have commented on it in the past, but every time I see it is just blows me away. If I was a full-on commodity farmer I think it would be enough to drive me to depression. How have we let this happen to ourselves? How can we reverse the trend?"

You know, I think I read somewhere that farmers are now making less per acre of food than we made back in the 1940's. All of this is due to other folks handling the shipping, marketing, processing and handling of the farm product. There really isn't any way to regain this unless the farmer starts doing more of that himself/herself. That would mean that thousand-acre farmers would be out of business...but then, it doesn't seem to be a profitable business, anyway.
We have to get away from the "bigger is better" thinking to shake this model. Producing more doesn't necessarily mean that you profit more, particularly with the rising costs of equipment, fuel and fertilizers in the traditional method. Smaller farms are more productive per acre, more responsive to change and more resiliant than industrial, mono-culture farms. They're healthier too, in most cases.
What we can do is to produce a quality farm product instead of producing quantity. Yes, that may mean that cereal companies would go out of business, but then, maybe we don't need shelves of "Sugar-frosted Coco-bits".

-Dave

nat said...

R.e. 7 cents... I'm not a market gardener, but I believe that if you sell direct to the consumer (farmers markets, CSAs, meat buying clubs), you get much closer to the full 100 cents in a food dollar. I've recently joined a meat buying club and the farmer processes all the poultry on his own farm, but sends the beef, pork and lamb out for slaughter and processing. Ethan, are you going to sell meat direct to consumers?

Rich said...

"...In 1910 Montana farmers received 60¢ of the food dollar ... now it is 7¢!?..."

I don't think that statistic is quite as dire as it first appears. Most food products are processed much more than they used to be, each step of processing is essentially "adding value", so the price goes up after each processing step. The lower percentage amount going to the farmer is simply a reflection of the value being added to each processing step.

If there was less processing, then obviously the farmer in 1910 would get a larger percentage of the food dollar, but not necessarily a larger total amount of money.

As an example, in 1910 if a farmer was growing wheat, he might be able to plant about 80 acres and harvest about 20 bushels per acre for a total harvest of about 1600 bu. of wheat.

His modern counterpart (using a small to medium sized farm as an example) might farm about 320 acres of wheat and might easily harvest about 40 bushels per acre, harvesting a total of 12800 bu. of wheat.

Of course, there is a certain amount of machinery needed today, but I think that it is pretty safe to assume that the same percentage of the harvested grain would go to cover operating costs, machinery, and custom harvesting (or threshing) regardless of the time period. If we accept that 50% of the grain would go to cover the expenses, the 1910 farmer has a profit of 800 bu., and his modern counterpart has a profit of about 6000 bu. of wheat.

When you adjust for inflation, a bu. of wheat is worth about the same in 1910 as it is today (not exactly but close enough). So as a farmer, I don't care what percentage of the total food dollar I am receiving, I'd rather have 6000 bu. of wheat than 800 bu. of wheat at the end of the year.

Dave said
"...get away from the "bigger is better" thinking to shake this model. Producing more doesn't necessarily mean that you profit more..."

I suspect that just as many small farms have trouble being profitable as large farms do, being small is no guarantee to being profitable.

Being bigger isn't the problem, getting too big too soon (especially by borrowing excessive amounts of money) is the problem, most businesses should have a plan that enables them to slowly grow until finally reaches an ideal size.

Steven said...

Rich,
I see your point, but I still think that it is worth thinking about. People spend X about of money on food and less of that money is now going to farmers. Of course that money is going to processes in between, and ultimately to the seller but none the less, it's not going to the farmer. There would be nothing wrong with us eating foods that were less processed and more of that money going to the farmer.

Rich said...

Steven, I agree that farmers should do all they can to receive a higher percentage of the amount of money spent on food, but I do see a problem when productions like this utilize misleading statements and assertions in trying to convince people that something needs to be changed.

When productions like this video make statements like "In 1910, Montana farmers received 60¢ of the food dollar ... now it is 7¢!?", failing to analyze the actual meaning of the statement and falsely implying that farmers are now only making 12% of the money they used to make in the past, it causes me to question their true intentions and their stated solutions to the problem.

I simply feel that there is no need to use these types of tactics to convince people that locally grown and processed food can be an attractive alternative to the current system of food production and distribution.

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