Tue, 17 Jul 2018
The prestigious CropLife magazine has launched its mid-year 2018 report on how the top US 100 ag retailers are performing so far through the year.
Following their research, and despite the challenges the ag industry is facing this year, it seems to be an overall good year thus far for the sector. By surveying the retailers, CropLife, has used a “0 to 10” scale method, 1 being poor and 10 being outstanding.
Apparently, there are many more ag retailers having a “good” year vs. “strong” or “poor” ones. “According to this year’s respondents, 72% would rate 2018 as between a four and a six. The remaining 28% split evenly (14%/14%) between calling the year “poor” (one to three) or “strong” (seven to 10). So, overall, the agricultural marketplace in 2018 through the spring season is off to a “good start,”” says the magazine.
While we embrace the great news, let’s also review the main challenges US agriculture is facing right now:
China, one of the biggest economies and the largest commodities consumer in the world, is not hiding its discontent towards the Trump administration and it is hitting it right in its natural resources.
Since they started imposing additional taxes on American fruits, nuts, pork and wine last April, the world knew this would be the start of something bigger. Nevertheless, this situation was speculated by analysts, considering Trump tariffs on steel and aluminium.
China explained that they will start with a round of tariffs on $34 billion worth of U.S. agricultural products, as well as automobiles, starting July 6th.
Considering the biggest hit is on agricultural commodities, this impacts not only on the economy of the nation, but directly on the household economy of farmers, many of them Trump voters, that trusted the republican to engage on better relations with a big player like China.
Products affected range from soy, corn, wheat, rice, sorghum, beef, pork, poultry, fish, dairy products, nuts and vegetables.
With an increasingly aging farm population, a reluctancy to adopt to modernisation within U.S agriculture is putting the development of the industry at stake.
Considering that the average U.S. farmer is, per last USDA census data, 58 years old, a pressing challenge for the agricultural sector is keeping up to date and benefiting from the latest technological advancements available to the sector. There is a need for this to ensure profitability in an era of economic concern and major industry upheaval.
After Monsanto acquired The Climate Corporation, new agriculturally related start-ups have been sprouting up in Silicon Valley, but “to be successful, ag entrepreneurs need to focus on creating companies that reduce costs, increase yields or improve efficiencies, and deliver benefits that farmers can actually measure. If the benefits are not clear, farmers will not invest. It’s that simple” says Rob Leclerc, from AgFunder.
Farmers and cooperatives throughout the agricultural sector agree that labour shortage and current immigration policies are one of the main challenges US agriculture is facing.
Considering that about 60 percent of the agricultural labour force is represented by immigrants (Chuck Conner, president of the National Council of Farm Cooperatives, a trade group, and former deputy agriculture secretary during the George W. Bush administration), the question now relies on how current immigration policies are affecting the sector and if it would be possible for farmers to continue their operations considering Americans won’t do the work immigrants do.
In Politico’s article “Farmers: Trump terrible for agriculture” Mr. Castañeda, a farm labour contractor in San Luis Obispo County in central California said, “There are growers out there screaming for labour”. “The people who are coming in are doing the work that not a single American would like to do.”
On the same line, Frank Muller, who grows tomatoes, peppers, almonds and walnuts on his California farm said, “My farm would shut down today if you removed my … workforce” “You hear all these disparaging remarks about immigrants, but these guys are the hardest-working, most dedicated people … I’ve ever seen in my life.”
To address these challenges, we have developed AG40 workshop, a programme designed around bringing key stakeholders from throughout US agriculture together to tackle the most issues in relation to the stability of the market. To find out how this will be achieved, and whether you can be involved in this, follow the link here and below:
ABOUT AG40
Challenge Advisory is bringing together AG40, a unique workshop where organisations will have the ability to network amongst each other for precise and profitable resolutions across the entire industry. There will be panel discussions and workshop sessions designed to create partnerships and profitable business development, helping to find cross-specialism solutions to current sectoral challenges.
Join Challenge Advisory and all our stakeholders for education, interoperability and investment relating to the latest technology in digital agriculture – click here to find out more:
Rebecca Lam
Rebecca Lam