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 Essay - jan/feb 2008
Winners, losers and concerns
James C. Delouche
Professor Emeritus Mississippi State University
Most events or actions have some good and some bad aspects, most commonly termed good news and bad news. In terms of the industries, companies and people involved in the situation or event, the good and bad news translates into winners and losers. Crop agriculture in the last century or so has had its share of winners and losers. The development of hybrid maize benefited resourceful maize farmers in ecologically favored areas and resulted in the development of a professional, technologically sophisticated seed industry. On the other hand, many resource poor maize farmers in less favored areas and the hundreds of local companies involved in the supply of seeds of local open pollinated maize varieties were losers because they were unable to take advantage of or adapt to the new maize technology. Similarly, one of the most frequent deficiencies cited for the "green revolution" in rice and wheat production was that although the benefits were enormous and widespread in terms of the rural economy and food security, many small, resource poor farmers did not benefit significantly and were losers. Essentially the same deficiency is being cited for the present very successful "gene" revolution in crop production based on extraordinary advances in biotechnology.
My family was a participant in the economically and sociologically profound changes in the agricultural sector brought about by mechanization. Before mechanization there were successful farmers with large land holdings, many tenant farmers and other farmer workers but there were also many successful farmers with smaller land holdings operated mostly with farm labor, the sort of farm I grew up on. The winners were the larger scale farmers with the financial resources for mechanization, the agricultural equipment manufacturers, and consumers who benefited from the more efficiently produced, lower cost food products. The losers were the smaller farmers who could not afford mechanization and the tenant farmers and workers displaced by machines. Many of the small farmers were forced to sell most or all of their land, usually to the larger farmers, and seek other employment in nearby towns, while most of the tenant farmers and workers migrated to the industrial cities. It can be argued, of course, that in the final analysis some of the tenant farmers and workers were winners rather than losers.
The Biofuels Paradox and Paradigm
If a paradox is something that exhibits or possesses contradictory aspects and a paradigm is a clear example or model, the present interest and focus on biofuels is a paradigm of a paradox. The unprecedented increase in the area planted to maize in the United States in 2007. I noted that while the great expansion of the maize grain ethanol industry is commonly considered a win-win situation in most of the farm and commodity publications, my view is that there are also many losers. The maize and other grain farmers, agric-businesses engaged in producing ethanol including many new and relatively small distillers, the maize seed companies and some politicians are the main and most obvious winners, but more-and-more they appear to be outnumbered by a growing legion of actual and potential losers. Groups and interests that earlier were thought to be among the winners have moved into the losers camp: livestock, poultry and dairy producers, the prepared and packaged food industries, energy economists, conservationists and other environmentalists. Energy experts and economists question the rationale of producing maize grain ethanol as an alternative to petroleum fuels when the ratio of energy output to energy input is barely greater than 1:1. Environmentalists are beginning to have doubts about the overall effects of increased ethanol use on greenhouse gas emissions. Conservationists are concerned about the effects of conversion of pastures and other conserved lands into croplands for maize and other grains on erosion, water supplies, and water quality. The potentially greatest losers in the maize grain ethanol boom, however, are the consumers of agricultural products confronted by increasing prices and, potentially at least, decreased quantities of some foods, the taxpayers presently funding subsidies for ethanol, and investors who "over invested" in production facilities that appear to greatly exceed the capacity needed.
The counter argument of the ethanol lobby is that the use of maize grain if only a first and learning step in the development of biofuels. They contend that efficiency will dramatically increase and the demand for maize grain dramatically decrease with the development of processes for the production of cellulosic ethanol using essentially waste or worthless wood and crop materials. But, the goal of a truly efficient and environmentally neutral or beneficial alternative fuel might be reached sooner using green algae, an organism that is unrelated to crop agriculture.
Sugarcane long used in Brazil for ethanol production is a much more efficient source material than maize grain. It yields twice as much ethanol per hectare as maize grain with a very favorable energy output/input ratio of 8:1. My question is this: why isn't more attention being given to the sweet sorghums for ethanol production. They produce considerable tonnages of high sugar content biomass per unit area Sorghum is also more drought tolerant than maize and could be grown in drier areas. If the recently identified gene in sorghum associated with tolerance to the high aluminum contents in some acid soils can be transferred to and expressed in productive sorghum lines or other crops species vast areas of essentially unproductive soils in Africa, Asia and South America could become productive and contribute to both food and fuel supplies. In the meanwhile, I remain very concerned along with many others about the tradeoff of food supplies for fuel.
Seed Industry Changes
During the past 50 years extraordinary advances in genetic science, associated biotechnology, agric-chemistry, mechanization, computational and information processing systems have led to rapid, revolutionary, dramatic and sometimes unsettling changes in crop variety development, seed production and supply, the base of crop agriculture. As in most science and technology generated revolutions the key and crucial change was in the political arena rather than the laboratory: the allocation of intellectual property rights for new and novel crop varieties, specific genetic traits for incorporation into crop varieties and some associated methodologies. Since the lack of intellectual property rights had been the main constraint to private sector investments in major segments of the seed industry, the acquisition of such rights attracted the attention and participation of investors and, most importantly, scientifically sophisticated and well managed chemical and pharmaceutical companies. A substantial part of seed industry research and development work was shifted from the field to the biotechnology laboratory for the identification, isolation, and transfer of specific genetic traits from a variety of organisms into good crop varieties. The considerable investments and skills required for biotechnological research and development and to navigate through the legal and regulatory loops have led to continuing consolidation and mergers in the industry and the demise of many small to medium size and even larger seed companies. Thus, the big winners in these revolutionary changes are the big crop genetic and seed companies, the farmers who plant and profit from their high technology varieties, and the general populace which benefits from favorable and stable food prices and the decrease in the use of herbicides, insecticides and other agric-chemicals. The losers were and are the smaller seed companies, small farmers who can't or won't adapt to high technology agriculture, some companies that manufacture herbicides and insecticides, and, of course, an assortment of other persons and groups philosophically and psychologically opposed to genetic engineering and the allocation of property rights to "nature's" creations. The winners group is increasing as varieties are developed with tolerance to environmental stresses and with output or end-use traits that enhance the appearance, taste, shelf life and nutritive content of food products.
There have been and always will be winners and losers in the wake of changes in agriculture and other sectors. It is important that the balance of winners to losers be determined and taken into account so that appropriate actions can be taken to maximize the winners and minimize the losers. It should be obvious from the discussions in this essay that in my view the present seed industry represents a win-win situation while the maize grain ethanol bubble is basically a lose-lose venture.
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