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The Industrialization of Agriculture: Implications for Public Concern and Environmental Consequences

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Title: The Industrialization of Agriculture: Implications for Public Concern and Environmental Consequences


1
The Industrialization of Agriculture
Implications for Public Concern and Environmental
Consequences of CAFOs
  • When/where did industrialized agriculture and
    CAFOs come into being?
  • What are the driving forces behind agricultural
    industrialization?
  • What consequences of industrialization and CAFO
    have caused controversy?
  • How are these consequences being dealt with by
    public policies and institutions?

2
Outline
  • 1.Review of Industrialization in the Poultry and
    Swine Sector
  • 2.Viewing Industrialization in a Broader Context
    for Conflict (or Policy) Analysis
  • 3.Consequences of Industrialization that Cause
    Conflict Over CAFOs
  • 4. Concluding Thoughts about Public Policy and
    Institutional Responses

3
1. Review of Industrialization in the Poultry and
Swine Sectors
  • Marriage of Scientific Knowledge and Industrial
    Economy Forces 
  • Ag industrialization is not a new thing! (Its
    been ongoing for many decades)
  • Selected Researchers Observations
  • 1960s 70s - Poultry (broiler) Industry
  • 1980s 90s - Swine Industry

4
Ag Industrialization - Observations of
Researchers in the 1960s 1970s
  • Scientific/Technological Knowledge Industrial
    Economy Forces
  • Specialization in services products
  • Substitution of off-farm activities for farm work
  • Decreased importance of land vs. capital
  • Separation of crop and animal production
  • Shift from land-based to capital-based activity
  • Could be located almost anywhere

5
Separation of Crops Livestock Had Implications
for Location of Enterprises
Global
Manure ? ? ?
6
Ag Industrialization - Observations of
Researchers in the 1960s 1970s
  • Scientific Knowledge and Industrial Forces
  • Specialization in services products
  • Substitution of off-farm activities for farm work
  • Decreased importance of land vs. capital
  • Separation of crop and animal production
  • Shift from land-based to capital-based activity
  • Could be located almost anywhere
  • Integration of Production-Marketing
    Geographical Concentration - Broilers

7
Integration of Production and Marketing
Geographical Concentration
  • First Application in Broiler Industry in 1960s
  • Industry Reorganization
  • Growth from Economies of Scale in Processing
  • Vertical Integration
  • Agglomeration Economies Clustering of
    production
  • Contracting
  • Processors/Integrators own birds
  • Contract fee reduced grower price risk
  • Growers clustered near large processors

8
Integration of Production and Marketing
Geographical Concentration
  • Geographic Shifts in Broilers (toward South)
  • Pre WW II
  • Delmarva, South (AK,TX), New England, Midwest
    (IN,IL)
  • Post WW II
  • Arkansas, Southeast (GA, AL, NC) and South (TX,
    MS), Delmarva
  • Consolidation has led to a highly industrialized
    and vertically integrated sector
  • Production 90 contracted, Dominant four firms

Source Martin and Zering, 1997
9
How Industrialization Happens
  • Comparative analysis of broiler, fed cattle and
    processing vegetable sectors
  • Identified three catalytic forces that trigger
    structural change
  • New mechanical, biological or organizational
    technology
  • Shifting market forces and demand
  • New government policies and programs

Source Reimund, Martin and Moore, USDA Economic
Research Service, 1981
10
 A Model of Structural Change Four Stage Process
  • Technological change - innovators adopt new
    technology
  • Locational shifts - production of the commodity
    moves to areas more amenable to changed methods
    than traditional ones
  • Growth and development - output rises as a
    result of newly gained efficiencies
  • Adjustment to risks - new institutions for
    coordination emerge and relationships within the
    sector evolve in order to manage new risks.  

Source Reimund, Martin and Moore, 1981
11
Observations in 1980s 1990s Focus Swine
Industry
  • Industrialization Trend Existed for Decades
  • Accelerated in late 1980s early 1990s
  • Significant Farm Exits, Consolidation, etc.
  • Major Geographic Shifts in the 1990s
  • Traditional Large Production Area was in Midwest
    states (IA, IL, IN, MN, NE, OH, SD)
  • Rapid expansion in the N. Carolina in early 1990s
  • Shifts to Great Plains (KS, OK) in late 1990s
  • Some Factors Driving Evolution of Sector

12
Factors Driving Rapid Evolution of the Swine
Sector
  • New technology
  • Biological Genetics and feeding
  • Mechanical - Improved housing, disease control
  • Organizational - Contracting, Vertical
    Integration
  • Shifting market forces and demand
  • Consumer meat preferences, Diet/Health
  • New government policies and programs?
  • State/Local Econ Dev Environmental Policies
  • Business Climate?
  • Market Control?

13
2. Viewing Industrialization in a Broader Context
for Conflict/Policy Analysis
  • Externalities and Public Policy
  • Existence of third party effects
    (externalities)
  • Peoples actions and welfare are linked
  • Existing Public Policy Determines Rules for who
    can do what to whom?
  • Industrialization as a Dynamic Process
  • New Linkages Between People
  • New Patterns of External Effects
  • Positive Opportunities (profits, jobs, income)
  • Negative Burdens or Costs (water
    degradation,odors)

14
Viewing Industrialization in a Broader Context
for Conflict/Policy Analysis
  • Existence of new opportunities (benefits) and
    burdens creates incentives for individuals and
    groups to change the policy rules
  • Those helped protect benefits and gains through
    industrialization
  • Those harmed protect themselves from the
    negative effects (damages or costs) of
    industrialization
  • People selectively view the consequences of
    industrialization depending on how they relate (
    or -) to the process.

15
Different Stakeholders will Selectively Perceive
or - Impacts of a Proposed CAFO
  • - CAFO owner
  • - Other producers
  • - Integrator
  • - Local Ag Suppliers
  • - Farmer Interest Groups
  • - Consumers
  • - Local Officials
  • Neighbors
  • Residents of rural area or watershed
  • Environmentalists
  • Water suppliers
  • State officials 
  • Federal officials

16
Viewing Industrialization in a Broader Context
for Conflict/Policy Analysis
  • Some Implications Questions
  • Are the current public policies obsolete?
  • How well do markets work to deal with the new
    pattern of externalities?
  • Do institutions exist for people to discuss and
    deal with negative and positive consequences of
    industrialization?
  • How can these processes and policies be improved?

17
3.Consequences of Industrialization that Cause
Conflict Over CAFOs
  • Three Dimensions of Conflict
  • People - History of relationships and
    personalities
  • Process - Patterns of interaction and possibly
    conflict escalation
  • Problem - (or content ) the issues and interests
    that are the reason for the dispute

Source Beer and Steif, 1997.
18
3. Consequences of Industrialization that Cause
Conflict Over CAFOs
  • Content Examples
  • National and Regional Scale
  • Nutrient Overabundance

19
Nutrient Cycle Doesnt Cycle!
Global
Manure ? ? ?
20
3. Consequences of Industrialization that Cause
Conflict Over CAFOs
  • Selected Problem (or Content) Examples
  • National and Regional Level
  • Generally - Nutrient Overabundance
  • Surface Water Quality
  • Spills from manure lagoons
  • Nitrogen and Phosphorus in the valued water
    resources Ecosystem and economic effects
  • Public Health Concerns in late 1990s Pfiesteria
    in water bodies in MD and NC and possible links
    to high levels of phosphorus from farms and other
    sources

21
Phosphorus Cycle Has Become Fragmented
Regional Boundary
State Boundary
Feed Mill Farm
Animals
Global
People
22
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23
3. Consequences of Industrialization that Cause
Conflict Over CAFOs
  • Selected Problem (or Content) Examples
  • State level
  • Existing Water Quality and/or Quantity
  • Future Quality of Water (or Air) Resources and
    their role in the States Development and
    residents quality of life
  • Future viability of an animal sector and
    associated income or jobs
  • Viability of other industries supported by
    agriculture

24
3. Consequences of Industrialization that Cause
Conflict Over CAFOs
Selected Problem (or Content) Examples Local
Community Level
  • Drinking water quality
  • Surface and groundwater quality
  • Water availability
  • Dead animal disposal
  • Insects and public health or nuisance issues
  • Odors
  • Air quality
  • Property Values
  • Farm or farmer viability
  • Ag-related businesses
  • Open space preservation

25
4.Concluding Thoughts about Public Policy
Responses
  • Industrialization as a Dynamic Process
  • New Patterns of Positive and Negative External
    Effects
  • Different stakeholders perceive different
    benefits or burdens depending on how they relate
    ( or -) to the process.
  • Question about policies and institutions that
    allow people to effectively express their
    concerns over the effects of industrialization

26
4.Concluding Thoughts about Public Policy
Responses
  • How Are the Consequences of Industrialization Are
    Being Dealt With By Public Policies and
    Institutions?
  • Current Level of Conflict over CAFOs-- suggests
    not very well.
  • Addition Efforts Looking at Boundary Issues at
    Several Levels

27
4.Concluding Thoughts about Public Policy
Responses
  • Explore Role of Boundary Issues
  • Firm level What costs do firms consider?
  • Federal State Local Govts - Who decides?
  • Between Agencies Who Decides Who Implements
    Policy?

28
3.Consequences of Industrialization that Cause
Conflict Over CAFOs
  • Three Dimensions of Conflict
  • People - History of relationships and
    personalities
  • Process - Patterns of interaction and possibly
    conflict escalation
  • Problem - (or content ) the issues and interests
    that are the reason for the dispute

29
3.Consequences of Industrialization That Cause
Conflict Over CAFOs
  • Acknowledge the People dimension
  • Process Issues -Previous interactions in
    policy-making
  • Environmentalists concerns about follow-through
    of a business or agency
  • Neighbors frustration that no state agency has
    jurisdiction over their concern (odors, insects,
    water quantity)

30
3.Consequences of Industrialization That Cause
Conflict Over CAFOs
  • Acknowledge the People dimension
  • Process Issues Some Examples
  • Previous interactions in policy-making
  • Environmentalists concerns about follow-through
    of a business or agency
  • Neighbors frustration that no state agency has
    jurisdiction over their concern (odors, insects,
    water quantity)

31
Conflict can be over Process
  • Results of Conflicts over Intensive Livestock
    Operations Potential for Public Participation
    Conflict Management project
  • Funded by PA Dept. of Ag. 1998 -2000
  • Universities
  • Penn State University
  • Ag Law Center Dickinson Law School/PSU
  • Juniata College

32
Key Stakeholder Concerns Intensive Livestock
Operations Study
  • Environmental Use
  • Health and Safety
  • The Role of Govt Officials
  • Economic Impact
  • Community Conflicts about Farming/Food
  • Decision Making Processes
  • The Possibility of Successful Resolution

33
Selected Stakeholder Concerns
  • Governments officials role (i.e. trust)
  • Lack of clarity of laws and govt
    responsibilities
  • Capabilities
  • Bias and/or Conflicts of interest
  • Decision making processes
  • Respect and civility Desire to have their input
    heard and considered
  • Frustration with current opportunities for
    education and dialogue
  • Lack of control (e.g., local govt preemption)

34
Need for Improved Conflict Management Methods
  • Avoid
  • High legal fees
  • Economic costs, delays
  • Losing control of decisions
  • Tearing of social fabric
  • Wasting community resources

35
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36
Recommended Processes
  • Mediation
  • Consensus Seeking Processes
  • Formal Public Hearings
  • Formal Review and Comment
  • Public Information Meetings

37
Focusing on Different Goals
  • Education of citizens
  • Public information meetings
  • Enhanced dialogue with citizens
  • Formal review and comment Formal hearings
  • Search for common ground to advise public
    decision making
  • Consensus seeking processes
  • Search for consensus and commitment by all
    stakeholders
  • Mediation
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