Last century, farming went horribly wrong. Now we can fix it
David Perry, Chief Executive Officer and Director, Indigo Agriculture
This article is part of the World Economic Forum Annual Meeting
In the first half of the twentieth century, a ballooning population was threatening global food security. We responded to this threat in the decades after the second world war, during a period we now refer to as the Green Revolution. This period was defined by the adoption and sweeping use of four agricultural technologies: plant breeding, synthetic fertilizers, crop chemicals and, beginning in the mid-90s, genetically modified traits. Alongside these technologies came changes to the supply chain: we began to treat many crops like commodities and, with the expanded use of grain elevators and railways, were able to store and transport harvests in bulk.
Agricultural output increased and a global food crisis was avoided, but it came at a cost. There was a proliferation of unsustainable practices in agriculture, and a wedge was driven between farmers and end-consumers, who became increasingly isolated from one another in this commoditized supply chain.
In our quest to produce enough calories for the growing population, we made a fundamental trade-off in regard to consumer and environmental health.
More farmers entered the commodity market, producing generally non-perishable, storable and transportable crops, which were assumed to meet generic commodity quality standards (standard weight, damage, contamination, etc). In a commodity grain market, farmers sell their crops at elevators, where they receive payments based on quantity produced (the market price per bushel). Their crops are then blended with other farmers’ crops, without regard to source, seed or the process by which they were grown. This system provides little incentive to farmers to invest in process or quality, as they are paid primarily for quantity. The result is an overall decrease in the quality of our food and the sustainability of our agricultural management practices.
Today, though, microbial and digital technologies have emerged that have the potential to free us from these trade-offs. Seed treatments developed from plant microbes, for example, have demonstrated the ability to increase yields under stressful growing conditions, such as drought, nitrogen limitation or pest infestation. While in many ways acting like their synthetic chemical counterparts, these products are discovered in nature and re-introduced to crops where they are most needed. In time, microbial products have the potential to replace the bulk of synthetic fertilizers and chemical insecticides used today.
Digital technologies have the potential to revolutionize decision-making both on the farm and by the consumer. Between planting and harvesting a crop, farmers have to make dozens of decisions. Which crop should they plant? What seed should they use? What is the right planting density? Planting depth? Today, though, farmers rarely have enough information to make data-based decisions. Precision agriculture, based around the adoption of software and data tools on the farm, has the potential to optimize nearly every decision that a farmer makes. Digital tools can also help connect consumers more meaningfully to farmers, fostering understanding and support for the production methods they use.
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Taken together, microbial and digital technologies have the potential to raise crop yields by over 50% in the next two decades. Such increases in productivity will allow for farmers to meet demand from a growing population, freeing us from the need to increase yields at any cost. When this happens, farmers will be able to differentiate their products by quality and method. Crop production will move from a paradigm of commoditization to one of specialization. In this paradigm, farmers are incentivized not only to increase yields, but also to deliver the types of sustainable and healthy crops that consumers value.
Although this vision may seem farfetched for the entrenched commodity agriculture industry, there is already evidence that it can work. The vertically integrated supply chains used in the coffee and cocoa sectors, for example, demonstrate the establishment of specialized markets that benefit both farmers and consumers.
Thirty years ago, there were only a few coffee brands available on store shelves. Now, we can purchase a variety of speciality coffee types grown by farmers in places like Ethiopia, Brazil and Indonesia — and many people are willing to pay a premium for specific flavors and other characteristics that they want. The yearly retail value of the US speciality coffee market stands at around $27 billion. This is good for coffee connoisseurs and it is really good for coffee farmers, many of whom have established profitable operations in microclimates where beans with distinctive flavors are produced. Engaged in speciality markets, small coffee producers often receive a significantly higher proportion of the total profit generated along the supply chain.
Similarly, demand for speciality cacao-based products (differentiated by features such as flavour, origin and organic or fair trade practices) has grown significantly. In the United States, for example, the amount of organic chocolate sold annually rose by 25 percent a year between 2002 and 2005. Globally, the market for organic and fair trade cocoa products is estimated to have grown by 65 perfect since 2002. Like in coffee, smallholder cacao farmers in South America, Central America and Africa are well-positioned to increase their margins.
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Today, buyers and end-consumers are increasingly willing to pay for high-quality, sustainably produced and identity-preserved food. We see this with the local food movement, the rise of the organic and fair trade markets and the diversification of dietary preferences. If we accept that new technologies will allow for enough food, we can move away from the basic and limiting question of “How will we feed ourselves?” and are liberated to address a much more interesting question: “What will the future of agriculture look like?”
We see a future where speciality markets achieved in products such as coffee and cacao are also achieved in a wide range of crops, including those that we most associate with industrial agriculture: grains. In this future, global farmers are profitable and rural communities are reinvigorated. Consumers have access to the kinds of foods that are important to them, whether they are looking for nutrition, flavour or cleaner means of production. Water-friendly, sustainably sourced, pesticide-free and reduced-fertilizer crops will have made their way into the market — and on a large scale. These types of crops will no longer represent a market only accessible to a fraction of consumers. Instead, they will define the food landscape, becoming the rule rather than the exception.
We envision a future where agricultural practices are fundamentally aligned with consumer preferences — a future where we can sustainably feed the world, with no tradeoffs required.
Originally published at www.weforum.org.
