Sunday, December 31, 2017

Battle of the Breadbaskets: US Versus China

The United States needs to strengthen its agriculture sector -- or be overtaken by China. The United States has long been the breadbasket of the world, as large swathes of fertile farmland and cutting-edge agricultural innovations have enabled it to both feed its own people and populations across the globe. However, America's agricultural leadership now faces a serious test from China. China has been making aggressive moves to boost its own agriculture sector in order to feed its population and become a major player in the global agricultural industry. With the world's population expected to reach nearly 10 billion by 2050, requiring a 70-percent increase in food production, the agriculture industry will play a critical role in the global economy. Given that trajectory, the U.S. agricultural industry must maintain its competitive edge in the face of a strong Chinese challenge for agricultural dominance.

More

Chinese leaders, many of whom witnessed the worst famines and largest population explosions in history, have agricultural modernization as one of their top goals. For the 14th year in a row, the Communist Part of China's "No. 1 Central Document" focused on the agricultural sector. With 19 percent of the world's population and only 7 percent of its cultivated land, China needs to boost the quantity and quality of its agricultural production to feed itself, and compete with the U.S. in feeding others. Achieving that goal requires advanced farming technology. Lacking the capacity to develop this technology domestically, China instead has pursued an aggressive investment strategy abroad, spending nearly $100 billion in the last decade to purchase foreign intellectual property involving agricultural production and technologies. ...

U.S. and EU agriculture companies must be prepared to face Chinese competitors that have the full backing of the state.

The United States has a significant comparative advantage in domestic research and development capabilities -- one that will take China decades to match. To keep that advantage, the U.S. government and the American private sector should redouble their research and development efforts to develop new and innovative technologies. One way industry can compete is by pooling resources and enhancing innovation through consolidation. Robert Young, the former chief economist for the American Farm Bureau Federation and the U.S. Senate Committee on Agriculture, Nutrition, and Forestry, recently noted how the combining of agricultural firms with different areas of expertise creates the potential for improved research processes and increased innovation.

Comments

One way industry can compete is by pooling resources and enhancing innovation through consolidation.

The ag industry in the U.S. and Europe is already controlled by an oligarchy. Also, is there any other industry that has (already) experienced such vertical integration?

Food prices in the U.S. are kept artificially low, and low prices do not usually result in innovation. R&D in the public sector is currently limited through bag tags and funding issues.

The article sounds like it is using a fear tactic to keep farmers on the technology treadmill.

#1 | Posted by horstngraben at 2017-12-31 12:07 PM

Why does there need to be a battle? Aren't there enough hungry people in the world?

#2 | Posted by Angrydad at 2017-12-31 06:37 PM

China may still be called a communist State, but under Xi it has morphed into a meritocracy and industrial powerhouse. It takes an industrial powerhouse to fund research and development. US agriculture is still the worlds best when it comes to corn, soy and wheat. Whether the current methods are sustainable is highly suspect. Water supplies in California and Monsanto science may unravel.

Do we really want to double the human population of earth? Everything is just getting more congested and expensive, lowering the quality of our lives. The best solution is to make sure women get a first class education. This reduces population growth without any coercion.

#3 | Posted by bayviking at 2018-01-01 07:29 AM

"China instead has pursued an aggressive investment strategy abroad, spending nearly $100 billion in the last decade"

They steal it too.

"Do we really want to double the human population of earth?"

Hard to imagine. Not me.

#4 | Posted by eberly at 2018-01-01 09:47 AM

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