Ariz. — THIS summer the tiny town of Furnace Creek, Calif., may once again grace
the nation’s front pages. Situated in Death Valley, it last made news in 1913,
when it set the record for the world’s hottest recorded temperature, at 134
degrees. With the heat wave currently blanketing the Western states, and given
that the mercury there has already reached 130 degrees, the news media is awash
in speculation that Furnace Creek could soon break its own mark.
Such speculation, though, misses the real concern posed by the heat wave, which
covers an area larger than New England. The problem isn’t spiking temperatures,
but a new reality in which long stretches of triple-digit days are common —
threatening not only the lives of the millions of people who live there, but
also a cornerstone of the American food supply.
People living outside the region seldom recognize its immense contribution to
American agriculture: roughly 40 percent of the net farm income for the country
normally comes from the 17 Western states; cattle and sheep production make up a
significant part of that, as do salad greens, dry beans, onions, melons, hops,
barley, wheat and citrus fruits. The current heat wave will undeniably diminish
both the quality and quantity of these foods.
The most vulnerable crops are those that were already in flower and fruit when
temperatures surged, from apricots and barley to wheat and zucchini. Idaho
farmers have documented how their potato yields have been knocked back because
their heat-stressed plants are not developing their normal number of tubers.
Across much of the region, temperatures on the surface of food and forage crops
hit 105 degrees, at least 10 degrees higher than the threshold for most
What’s more, when food and forage crops, as well as livestock, have had to
endure temperatures 10 to 20 degrees higher than the long-term averages, they
require far more water than usual. The Western drought, which has persisted for
the last few years, has already diminished both surface water and groundwater
supplies and increased energy costs, because of all the water that has to be
pumped in from elsewhere.
If these costs are passed on to consumers, we can again expect food prices,
especially for beef and lamb, to rise, just as they did in 2012, the hottest
year in American history. So extensive was last year’s drought that more than
1,500 counties — about half of all the counties in the country — were declared
national drought disaster areas, and 90 percent of those were hit by heat waves
The answer so far has been to help affected farmers with payouts from crop
insurance plans. But while we can all sympathize with affected farmers, such
assistance is merely a temporary response to a long-term problem.
Fortunately, there are dozens of time-tested strategies that our best farmers
and ranchers have begun to use. The problem is that several agribusiness
advocacy organizations have done their best to block any federal effort to
promote them, including leaving them out of the current farm bill, or of climate
change legislation at all.
One strategy would be to promote the use of locally produced compost to increase
the moisture-holding capacity of fields, orchards and vineyards. In addition to
locking carbon in the soil, composting buffers crop roots from heat and drought
while increasing forage and food-crop yields. By simply increasing organic
matter in their fields from 1 percent to 5 percent, farmers can increase water
storage in the root zones from 33 pounds per cubic meter to 195 pounds.
And we have a great source of compostable waste: cities. Since much of the green
waste in this country is now simply generating methane emissions from landfills,
cities should be mandated to transition to green-waste sorting and composting,
which could then be distributed to nearby farms.
Second, we need to reduce the bureaucratic hurdles to using small- and
medium-scale rainwater harvesting and gray water (that is, waste water excluding
toilet water) on private lands, rather than funneling all runoff to huge, costly
and vulnerable reservoirs behind downstream dams. Both urban and rural food
production can be greatly enhanced through proven techniques of harvesting rain
and biologically filtering gray water for irrigation. However, many state and
local laws restrict what farmers can do with such water.
Moreover, the farm bill should include funds from the Strikeforce Initiative of
the Department of Agriculture to help farmers transition to forms of perennial
agriculture — initially focusing on edible tree crops and perennial grass
pastures — rather than providing more subsidies to biofuel production from
annual crops. Perennial crops not only keep 7.5 to 9.4 times more carbon in the
soil than annual crops, but their production also reduces the amount of fossil
fuels needed to till the soil every year.
We also need to address the looming seed crisis. Because of recent episodes of
drought, fire and floods, we are facing the largest shortfall in the
availability of native grass, forage legume, tree and shrub seeds in American
history. Yet current budget-cutting proposals threaten to significantly reduce
the number of federal plant material centers, which promote conservation best
If our rangelands, forests and farms are to recover from the devastating heat,
drought and wildfires of the last three years, they need to be seeded with
appropriate native forage and ground-cover species to heal from the wounds of
climatic catastrophes. To that end, the farm bill should direct more money to
the underfinanced seed collection and distribution programs.
Finally, the National Plant Germplasm System, the Department of Agriculture’s
national reserve of crop seeds, should be charged with evaluating hundreds of
thousands of seed collections for drought and heat tolerance, as well as other
climatic adaptations — and given the financing to do so. Thousands of heirloom
vegetables and heritage grains already in federal and state collections could be
rapidly screened and then used by farmers for a fraction of what it costs a
biotech firm to develop, patent and market a single “climate-friendly” crop.
Investing in climate-change adaptation will be far more cost-effective than
doling out $11.6 billion in crop insurance payments, as the government did last
year, for farmers hit with diminished yields or all-out crop failures.
Unfortunately, some agribusiness organizations fear that if they admit that
accelerating climate change is already affecting farmers, it will shackle them
with more regulations. But those organizations are hardly serving their member
farmers and ranchers if they keep them at risk of further suffering from heat
extremes and extended drought.
And no one can reasonably argue that the current system offers farmers any
long-term protection. Last year some farmers made more from insurance payments
than from selling their products, meaning we are dangerously close to
subsidizing farmers for not adapting to changing climate conditions.
It’s now up to our political and business leaders to get their heads out of the
hot sand and do something tangible to implement climate change policy and
practices before farmers, ranchers and consumers are further affected. Climate
adaptation is the game every food producer and eater must now play. A little
investment coming too late will not help us adapt in time to this new reality.
Nabhan is a research scientist
Southwest Center at the University of Arizona
and the author
of “Growing Food in a Hotter, Drier Land:
OBREGÓN, Mexico — The dun wheat field spreading out at Ravi P. Singh’s feet
offered a possible clue to human destiny. Baked by a desert sun and deliberately
starved of water, the plants were parched and nearly dead.
Dr. Singh, a wheat breeder, grabbed seed heads that should have been plump with
the staff of life. His practiced fingers found empty husks.
“You’re not going to feed the people with that,” he said.
But then, over in Plot 88, his eyes settled on a healthier plant, one that had
managed to thrive in spite of the drought, producing plump kernels of wheat.
“This is beautiful!” he shouted as wheat beards rustled in the wind.
Hope in a stalk of grain: It is a hope the world needs these days, for the great
agricultural system that feeds the human race is in trouble.
The rapid growth in farm output that defined the late 20th century has slowed to
the point that it is failing to keep up with the demand for food, driven by
population increases and rising affluence in once-poor countries.
Consumption of the four staples that supply most human calories — wheat, rice,
corn and soybeans — has outstripped production for much of the past decade,
drawing once-large stockpiles down to worrisome levels. The imbalance between
supply and demand has resulted in two huge spikes in international grain prices
since 2007, with some grains more than doubling in cost.
Those price jumps, though felt only moderately in the West, have worsened hunger
for tens of millions of poor people, destabilizing politics in scores of
countries, from Mexico to Uzbekistan to Yemen. The Haitian government was ousted
in 2008 amid food riots, and anger over high prices has played a role in the
recent Arab uprisings.
Now, the latest scientific research suggests that a previously discounted factor
is helping to destabilize the food system: climate change.
Many of the failed harvests of the past decade were a consequence of weather
disasters, like floods in the United States, drought in Australia and blistering
heat waves in Europe and Russia. Scientists believe some, though not all, of
those events were caused or worsened by human-induced global warming.
Temperatures are rising rapidly during the growing season in some of the most
important agricultural countries, and a paper published several weeks ago found
that this had shaved several percentage points off potential yields, adding to
the price gyrations.
For nearly two decades, scientists had predicted that climate change would be
relatively manageable for agriculture, suggesting that even under worst-case
assumptions, it would probably take until 2080 for food prices to double.
In part, they were counting on a counterintuitive ace in the hole: that rising
carbon dioxide levels, the primary contributor to global warming, would act as a
powerful plant fertilizer and offset many of the ill effects of climate change.
Until a few years ago, these assumptions went largely unchallenged. But lately,
the destabilization of the food system and the soaring prices have rattled many
“The success of agriculture has been astounding,” said Cynthia Rosenzweig, a
researcher at NASA who helped pioneer the study of climate change and
agriculture. “But I think there’s starting to be premonitions that it may not
A scramble is on to figure out whether climate science has been too sanguine
about the risks. Some researchers, analyzing computer forecasts that are used to
advise governments on future crop prospects, are pointing out what they consider
to be gaping holes. These include a failure to consider the effects of extreme
weather, like the floods and the heat waves that are increasing as the earth
A rising unease about the future of the world’s food supply came through during
interviews this year with more than 50 agricultural experts working in nine
These experts say that in coming decades, farmers need to withstand whatever
climate shocks come their way while roughly doubling the amount of food they
produce to meet rising demand. And they need to do it while reducing the
considerable environmental damage caused by the business of agriculture.
Agronomists emphasize that the situation is far from hopeless. Examples are
already available, from the deserts of Mexico to the rice paddies of India, to
show that it may be possible to make agriculture more productive and more
resilient in the face of climate change. Farmers have achieved huge gains in
output in the past, and rising prices are a powerful incentive to do so again.
But new crop varieties and new techniques are required, far beyond those
available now, scientists said. Despite the urgent need, they added, promised
financing has been slow to materialize, much of the necessary work has yet to
begin and, once it does, it is likely to take decades to bear results.
“There’s just such a tremendous disconnect, with people not understanding the
highly dangerous situation we are in,” said Marianne Bänziger, deputy chief of
the International Maize and Wheat Improvement Center, a leading research
institute in Mexico.
A wheat physiologist at the center, Matthew Reynolds, fretted over the potential
consequences of not attacking the problem vigorously.
“What a horrible world it will be if food really becomes short from one year to
the next,” he said. “What will that do to society?”
Sitting with a group of his fellow wheat farmers, Francisco Javier Ramos Bours
voiced a suspicion. Water shortages had already arrived in recent years for
growers in his region, the Yaqui Valley, which sits in the Sonoran Desert of
northwestern Mexico. In his view, global climate change could well be
“All the world is talking about it,” Mr. Ramos said as the other farmers nodded.
Farmers everywhere face rising difficulties: water shortages as well as flash
floods. Their crops are afflicted by emerging pests and diseases and by blasts
of heat beyond anything they remember.
In a recent interview on the far side of the world, in northeastern India, a
rice farmer named Ram Khatri Yadav offered his own complaint about the changing
climate. “It will not rain in the rainy season, but it will rain in the nonrainy
season,” he said. “The cold season is also shrinking.”
Decades ago, the wheat farmers in the Yaqui Valley of Mexico were the vanguard
of a broad development in agriculture called the Green Revolution, which used
improved crop varieties and more intensive farming methods to raise food
production across much of the developing world.
When Norman E. Borlaug, a young American agronomist, began working here in the
1940s under the sponsorship of the Rockefeller Foundation, the Yaqui Valley
farmers embraced him. His successes as a breeder helped farmers raise Mexico’s
wheat output sixfold.
In the 1960s, Dr. Borlaug spread his approach to India and Pakistan, where mass
starvation was feared. Output soared there, too.
Other countries joined the Green Revolution, and food production outstripped
population growth through the latter half of the 20th century. Dr. Borlaug
became the only agronomist ever to win the Nobel Peace Prize, in 1970, for
helping to “provide bread for a hungry world.”
As he accepted the prize in Oslo, he issued a stern warning. “We may be at high
tide now,” he said, “but ebb tide could soon set in if we become complacent and
relax our efforts.”
As output rose, staple grains — which feed people directly or are used to
produce meat, eggs, dairy products and farmed fish — became cheaper and cheaper.
Poverty still prevented many people in poor countries from buying enough food,
but over all, the percentage of hungry people in the world shrank.
By the late 1980s, food production seemed under control. Governments and
foundations began to cut back on agricultural research, or to redirect money
into the problems created by intensive farming, like environmental damage. Over
a 20-year period, Western aid for agricultural development in poor countries
fell by almost half, with some of the world’s most important research centers
suffering mass layoffs.
Just as Dr. Borlaug had predicted, the consequences of this loss of focus began
to show up in the world’s food system toward the end of the century. Output
continued to rise, but because fewer innovations were reaching farmers, the
growth rate slowed.
That lull occurred just as food and feed demand was starting to take off, thanks
in part to rising affluence across much of Asia. Millions of people added meat
and dairy products to their diets, requiring considerable grain to produce.
Other factors contributed to demand, including a policy of converting much of
the American corn crop into ethanol.
And erratic weather began eating into yields. A 2003 heat wave in Europe that
some researchers believe was worsened by human-induced global warming slashed
agricultural output in some countries by as much as 30 percent. A long drought
in Australia, also possibly linked to climate change, cut wheat and rice
In 2007 and 2008, with grain stockpiles low, prices doubled and in some cases
tripled. Whole countries began hoarding food, and panic buying ensued in some
markets, notably for rice. Food riots broke out in more than 30 countries.
Farmers responded to the high prices by planting as much as possible, and
healthy harvests in 2008 and 2009 helped rebuild stocks, to a degree. That
factor, plus the global recession, drove prices down in 2009. But by last year,
more weather-related harvest failures sent them soaring again. This year, rice
supplies are adequate, but with bad weather threatening the wheat and corn crops
in some areas, markets remain jittery.
Experts are starting to fear that the era of cheap food may be over. “Our
mindset was surpluses,” said Dan Glickman, a former United States secretary of
agriculture. “That has just changed overnight.”
Forty years ago, a third of the population in the developing world was
undernourished. By the tail end of the Green Revolution, in the mid-1990s, the
share had fallen below 20 percent, and the absolute number of hungry people
dipped below 800 million for the first time in modern history.
But the recent price spikes have helped cause the largest increases in world
hunger in decades. The Food and Agriculture Organization of the United Nations
estimated the number of hungry people at 925 million last year, and the number
is expected to be higher when a fresh estimate is completed this year. The World
Bank says the figure could be as high as 940 million.
Dr. Borlaug’s latest successor at the corn and wheat institute, Hans-Joachim
Braun, recently outlined the challenges facing the world’s farmers. On top of
the weather disasters, he said, booming cities are chewing up agricultural land
and competing with farmers for water. In some of the world’s breadbaskets,
farmers have achieved high output only by pumping groundwater much faster than
nature can replenish it.
“This is in no way sustainable,” Dr. Braun said.
The farmers of the Yaqui Valley grow their wheat in a near-desert, relying on
irrigation. Their water comes by aqueduct from nearby mountains, but for parts
of the past decade, rainfall was below normal. Scientists do not know if this
has been a consequence of climate change, but Northern Mexico falls squarely
within a global belt that is expected to dry further because of human emissions
of greenhouse gases.
Dr. Braun is leading efforts to tackle problems of this sort with new wheat
varieties that would be able to withstand many kinds of stress, including scant
water. Descendants of the plant that one of his breeders, Dr. Singh, found in a
wheat field one recent day might eventually wind up in farmers’ fields the world
But budgets for this kind of research remain exceedingly tight, frustrating
agronomists who feel that the problems are growing more urgent by the year.
“There are biological limitations on how fast we can do this work,” Dr. Braun
said. “If we don’t get started now, we are going to be in serious trouble.”
For decades, scientists believed that the human dependence on fossil fuels, for
all the problems it was expected to cause, would offer one enormous benefit.
Carbon dioxide, the main gas released by combustion, is also the primary fuel
for the growth of plants. They draw it out of the air and, using the energy from
sunlight, convert the carbon into energy-dense compounds like glucose. All human
and animal life runs on these compounds.
Humans have already raised the level of carbon dioxide in the atmosphere by 40
percent since the Industrial Revolution, and are on course to double or triple
it over the coming century. Studies have long suggested that the extra gas would
supercharge the world’s food crops, and might be especially helpful in years
when the weather is difficult.
But many of those studies were done in artificial conditions, like greenhouses
or special growth chambers. For the past decade, scientists at the University of
Illinois have been putting the “CO2 fertilization effect” to a real-world test
in the two most important crops grown in the United States.
They started by planting soybeans in a field, then sprayed extra carbon dioxide
from a giant tank. Based on the earlier research, they hoped the gas might bump
yields as much as 30 percent under optimal growing conditions.
But when they harvested their soybeans, they got a rude surprise: the bump was
only half as large. “When we measured the yields, it was like, wait a minute —
this is not what we expected,” said Elizabeth A. Ainsworth, a Department of
Agriculture researcher who played a leading role in the work.
When they grew the soybeans in the sort of conditions expected to prevail in a
future climate, with high temperatures or low water, the extra carbon dioxide
could not fully offset the yield decline caused by those factors.
They also ran tests using corn, America’s single most valuable crop and the
basis for its meat production and its biofuel industry. While that crop was
already known to be less responsive to carbon dioxide, a yield bump was still
expected — especially during droughts. The Illinois researchers got no bump.
Their work has contributed to a broader body of research suggesting that extra
carbon dioxide does act as plant fertilizer, but that the benefits are less than
previously believed — and probably less than needed to avert food shortages.
“One of the things that we’re starting to believe is that the positives of CO2
are unlikely to outweigh the negatives of the other factors,” said Andrew D. B.
Leakey, another of the Illinois researchers.
Other recent evidence suggests that longstanding assumptions about food
production on a warming planet may have been too optimistic.
Two economists, Wolfram Schlenker of Columbia University and Michael J. Roberts
of North Carolina State University, have pioneered ways to compare crop yields
and natural temperature variability at a fine scale. Their work shows that when
crops are subjected to temperatures above a certain threshold — about 84 degrees
for corn and 86 degrees for soybeans — yields fall sharply.
This line of research suggests that in the type of climate predicted for the
United States by the end of the century, with more scorching days in the growing
season, yields of today’s crop varieties could fall by 30 percent or more.
Though it has not yet happened in the United States, many important agricultural
countries are already warming rapidly in the growing season, with average
increases of several degrees. A few weeks ago, David B. Lobell of Stanford
University published a paper with Dr. Schlenker suggesting that temperature
increases in France, Russia, China and other countries were suppressing crop
yields, adding to the pressures on the food system.
“I think there’s been an under-recognition of just how sensitive crops are to
heat, and how fast heat exposure is increasing,” Dr. Lobell said.
Such research has provoked controversy. The findings go somewhat beyond those of
a 2007 report by the Intergovernmental Panel on Climate Change, the United
Nations body that episodically reviews climate science and advises governments.
That report found that while climate change was likely to pose severe challenges
for agriculture in the tropics, it would probably be beneficial in some of the
chillier regions of the Northern Hemisphere, and that the carbon dioxide effect
should offset many problems.
In an interview at the University of Illinois, one of the leading scientists
behind the work there, Stephen P. Long, sharply criticized the 2007 report,
saying it had failed to sound a sufficient alarm. “I felt it needed to be much
more honest in saying this is our best guess at the moment, but there are
probably huge errors in there,” Dr. Long said. “We’re talking about the future
food supply of the world.”
William E. Easterling, dean of earth sciences at Pennsylvania State University
and a primary author of the 2007 report, said in an interview that the recent
research had slightly altered his perspective. “We have probably to some extent
overestimated” the benefits of carbon dioxide in computerized crop forecasts, he
said. But he added that applying a “correction factor” would probably take care
of the problem, and he doubted that the estimates in the report would change
drastically as a result.
The 2007 report did point out a hole in the existing body of research: most
forecasts had failed to consider several factors that could conceivably produce
nasty surprises, like a projected rise in extreme weather events. No sooner had
the report been published than food prices began rising, partly because of crop
failures caused by just such extremes.
Oxfam, the international relief group, projected recently that food prices would
more than double by 2030 from today’s high levels, with climate change
responsible for perhaps half the increase. As worries like that proliferate,
some scientists are ready to go back to the drawing board regarding agriculture
and climate change.
Dr. Rosenzweig, the NASA climate scientist, played a leading role in forming the
old consensus. But in an interview at her office in Manhattan, she ticked off
recent stresses on the food system and said they had led her to take a fresh
She is pulling together a global consortium of researchers whose goal will be to
produce more detailed and realistic computer forecasts; she won high-level
endorsement for the project at a recent meeting between British and United
States officials. “We absolutely have to get the science lined up to provide
these answers,” Dr. Rosenzweig said.
At the end of a dirt road in northeastern India, nestled between two streams,
lies the remote village of Samhauta. Anand Kumar Singh, a farmer there, recently
related a story that he could scarcely believe himself.
Last June, he planted 10 acres of a new variety of rice. On Aug. 23, the area
was struck by a severe flood that submerged his field for 10 days. In years
past, such a flood would have destroyed his crop. But the new variety sprang
back to life, yielding a robust harvest.
“That was a miracle,” Mr. Singh said.
The miracle was the product not of divine intervention but of technology — an
illustration of how far scientists may be able to go in helping farmers adapt to
the problems that bedevil them.
“It’s the best example in agriculture,” said Julia Bailey-Serres, a researcher
at the University of California, Riverside, who has done genetic work on the
rice variety that Mr. Singh used. “The submergence-tolerant rice essentially
sits and waits out the flood.”
In the heyday of the Green Revolution, the 1960s, leaders like Dr. Borlaug
founded an international network of research centers to focus on the world’s
major crops. The corn and wheat center in Mexico is one. The new rice variety
that is exciting farmers in India is the product of another, the International
Rice Research Institute in the Philippines.
Leading researchers say it is possible to create crop varieties that are more
resistant to drought and flooding and that respond especially well to rising
carbon dioxide. The scientists are less certain that crops can be made to
withstand withering heat, though genetic engineering may eventually do the
The flood-tolerant rice was created from an old strain grown in a small area of
India, but decades of work were required to improve it. Money was so tight that
even after the rice had been proven to survive floods for twice as long as
previous varieties, distribution to farmers was not assured. Then an American
charity, the Bill & Melinda Gates Foundation, stepped in with a $20 million
grant to finance final development and distribution of the rice in India and
other countries. It may get into a million farmers’ hands this year.
The Gateses, widely known for their work in public health, have also become
leading backers of agricultural projects in recent years. “I’m an optimist,” Mr.
Gates said in an interview. “I think we can get crops that will mitigate many of
The Gates Foundation has awarded $1.7 billion for agricultural projects since
2006, but even a charity as large as it is cannot solve humanity’s food problems
on its own. Governments have recognized that far more effort is needed on their
part, but they have been slow to deliver.
In 2008 and 2009, in the midst of the political crises set off by food prices,
the world’s governments outbid one another to offer support. At a conference in
L’Aquila, Italy, they pledged about $22 billion for agricultural development.
It later turned out, however, that no more than half of that was new money not
previously committed to agriculture, and two years later, the extra financing
has not fully materialized. “It’s a disappointment,” Mr. Gates said.
The Obama administration has won high marks from antihunger advocates for
focusing on the issue. President Obama pledged $3.5 billion at L’Aquila, more
than any other country, and the United States has begun an ambitious initiative
called Feed the Future to support agricultural development in 20 of the neediest
So far, the administration has won $1.9 billion from Congress. Amid the budget
struggles in Washington, it remains to be seen whether the United States will
fully honor its pledge.
Perhaps the most hopeful sign nowadays is that poor countries themselves are
starting to invest in agriculture in a serious way, as many did not do in the
years when food was cheap.
In Africa, largely bypassed by the Green Revolution but with enormous potential,
a dozen countries are on the verge of fulfilling a promise to devote 10 percent
of their budgets to farm development, up from 5 percent or less.
“In my country, every penny counts,” Agnes Kalibata, the agriculture minister of
Rwanda, said in an interview. With difficulty, Rwanda has met the 10 percent
pledge, and she cited a terracing project in the country’s highlands that has
raised potato yields by 600 percent for some farmers.
Yet the leading agricultural experts say that poor countries cannot solve the
problems by themselves. The United Nations recently projected that global
population would hit 10 billion by the end of the century, 3 billion more than
today. Coupled with the demand for diets richer in protein, the projections mean
that food production may need to double by later in the century.
Unlike in the past, that demand must somehow be met on a planet where little new
land is available for farming, where water supplies are tightening, where the
temperature is rising, where the weather has become erratic and where the food
system is already showing serious signs of instability.
“We’ve doubled the world’s food production several times before in history, and
now we have to do it one more time,” said Jonathan A. Foley, a researcher at the
University of Minnesota. “The last doubling is the hardest. It is possible, but
it’s not going to be easy.”
ANGELES/NEW YORK (Reuters) - McDonald's Corp (MCD.N: Quote, Profile, Research,
Stock Buzz) forecast higher prices for beef, dairy and other items and said it
would cautiously raise prices to keep attracting diners, who are grappling with
higher grocery and gas bills.
Shares fell 1.5 percent after the world's biggest hamburger chain said it
planned to offset some, but not all, of its higher food costs, with small price
increases throughout the year.
McDonald's results landed a day after rival Yum Brands Inc (YUM.N: Quote,
Profile, Research, Stock Buzz) reported strong China results that masked rising
food and labor costs. Chipotle Mexican Grill (CMG.N: Quote, Profile, Research,
Stock Buzz), which has nearly all of its 1,100 restaurants in the United States,
saw higher food costs eat into margins.
McDonald's and other restaurant operators are getting squeezed by accelerating
food costs and must figure out how to raise prices without scaring away already
"It's very hard to pass through price increase right now," said Stifel Nicolaus
analyst Steve West.
McDonald's Chief Executive Jim Skinner said customers are getting "pinched
everywhere. They should not suffer the same fate at McDonald's."
Chief Financial Officer Pete Bensen said the company would sacrifice some
short-term margin to protect long-term growth. He added that McDonald's has
experience finding the right recipe for price increases in fragile economic
McDonald's now expects food costs to rise between 4 percent and 4.5 percent in
the United States and Europe this year. That is up from its prior call for a
rise of 2 percent to 2.5 percent in the United States and an increase of 3.5
percent to 4.5 percent in Europe.
McDonald's in March put through a 1 percent menu price rise in the United
States, where it plans additional increases. Prices in Europe are up by the same
amount and the company plans to raise prices in China.
When it comes to raising prices, West said McDonald's has an edge because it
attracts a higher-income diner than other fast-food chains. It could have the
best luck raising prices on things like premium burgers and McCafe drinks that
appeal to those customers, he said.
After struggling during the recession, McDonald's has outperformed its fast-food
peers by updating its menu to broaden its appeal beyond the young males that
account for the biggest share of sales at most other fast-food chains.
"The bottom line is they're still doing a great job of growing revenue," said
Peter Jankovskis, co-chief investment officer at Oakbrook Investments.
Analysts remain worried that high gas prices could force fast-food restaurant
patrons to cut back. But Jankovskis said McDonald's was better equipped than
others to cope.
McDonald's has roughly 32,700 restaurants around the world. The United States
alone has 14,000 units, which means customers do not have to travel far to get
"The big test will come in the summer months with gasoline remaining in the
neighborhood of $4.00 (a gallon) -- that's when the strength of McDonald's will
come through," he said.
March sales at restaurants open at least 13 months were up 3 percent in the
United States, up 4.9 percent in Europe and gained 0.5 percent in McDonald's
Asia/Pacific, Middle East and Africa unit. Asia results were adversely affected
by the earthquake and tsunami in Japan, but that the impact on overall income
was "minor," Skinner said.
First-quarter net income rose 10.9 percent to $1.21 billion, or $1.15 per share,
topping analysts' profit view by a penny, according to Thomson Reuters I/B/E/S.
Total first-quarter revenue at the Golden Arches rose 9 percent to $6.1 billion,
with sales in Europe leading the way.
Still, operating margin fell to 17.7 percent from 18.2 percent as costs for food
and paper rose. Food and paper costs were 33.6 percent of sales in the quarter,
compared with 32.9 percent a year earlier.
McDonald's shares fell 1.5 percent, or $1.17, to $76.23 in midday trading on the
New York Stock Exchange.
The New York Times
By ROBERT D. McFADDEN
Tyson, an aggressive and visionary entrepreneur who dropped out of college and
built his father’s Arkansas chicken business into the behemoth Tyson Foods, one
of the world’s largest producers of poultry, beef and pork, died on Thursday. He
was 80 and lived in Fayetteville, Ark. The cause was complications of cancer,
Tyson Foods said.
Shrewd, folksy and often likened to fellow Arkansans Sam Walton, the late
Wal-Mart tycoon, and former President Bill Clinton, Mr. Tyson was a risk-taking,
bare-knuckle businessman who bought out dozens of competitors, skirted the edge
of the law and transformed a Depression-era trucking-and-feed venture into a
global enterprise with an army of employees and millions of customers in 57
Tyson Foods became a household name as he popularized the Rock Cornish game hen
as a high-profit specialty item; helped develop McDonald’s Chicken McNuggets and
KFC’s Rotisserie Gold, and stocked America’s grocery stores with fresh and
frozen chickens — killed, cleaned and packaged in his archipelago of processing
“It was pretty much Don’s vision that fueled the company,” Mark A. Plummer, an
analyst for Stephens Inc., a Little Rock financial services firm, told The New
York Times in 1994, the year before Mr. Tyson stepped down after nearly three
decades as chairman. “He saw that if you added more convenience by further
processing the chicken, consumers would pay for it.”
Mr. Tyson grew up on a farm with squawking chickens and became one of the
world’s richest men, a down-home billionaire who dressed in khaki uniforms like
his workers, with “Don” and the Tyson logo stitched over the shirt pockets. He
looked like a farmer down at the feed co-op: a short, stocky man with a paunch
and a round weather-beaten face, a baldish pate and a gray chin-strap beard.
But he cultivated presidents and members of Congress, threw lavish society
parties, took glamorous young women to Wall Street meetings, jetted around the
world and spent weeks at a time on his yacht fishing off Brazil or Baja
California for the spear-nosed, blue-water trophy marlins that decorated his
company headquarters and his homes in Arkansas, England and Mexico.
Critics said his tigerish corporate philosophy — “grow or die” — led to many
acquisitions, notably the bitterly contested purchase of Holly Farms for $1.5
billion in 1989, which made Tyson Foods the nation’s No. 1 poultry producer,
dwarfing ConAgra and Perdue Farms. But it also led to risky deals, questionable
business practices and political ties that produced legal entanglements for him
and the company.
Mr. Tyson and his son and future successor, John H. Tyson, were accused of
helping to arrange illegal gifts to President Clinton’s first-term secretary of
agriculture, Mike Espy, including plane trips, lodging and football tickets,
when his agency was considering tougher safety and inspection regulations
affecting Tyson Foods.
Mr. Espy resigned in 1994, but four years later was acquitted of accepting
illegal gifts. In 1997, Tyson Foods pleaded guilty to making $12,000 in such
gifts to Mr. Espy and paid $6 million in fines and costs. Don and John Tyson
were named unindicted co-conspirators and testified before a grand jury in
exchange for immunity from prosecution. (In an unrelated 2004 case, Don Tyson
and Tyson Foods agreed to pay $1.7 million to settle a federal complaint that
the company did not fully disclose benefits to Mr. Tyson.)
Mr. Tyson’s legal problems tainted but hardly overshadowed a career widely
regarded as a stunning American success story. But his legacy of aggressive
management continued to trouble the company when he served as the semiretired
“senior chairman” after 1995 and even after he retired in 2001.
Environmentalists accused Tyson of fouling waterways. Animal rights groups said
it raised chickens in cruel conditions. Regulators said it discriminated against
women and blacks and cheated workers out of wages. Tyson Foods denied
wrongdoing, but paid fines, back wages and penalties to settle some cases.
In 2001 the company and three managers were charged with conspiring for years to
smuggle illegal immigrants from Mexico and South America to work in its plants,
but all were acquitted.
Marvin Schwartz, who wrote a history of Tyson Foods, “Tyson: From Farm to
Market,” said its culture reflected its leader. “Don is a gambler, and he’s very
comfortable taking risks,” he said. “And in a state like Arkansas, where there
are very few regulatory controls, corporations have more flexibility. The state
motto was ‘The Land of Opportunity,’ and that’s why entrepreneurs like Sam
Walton and Don Tyson have made it here.”
Donald John Tyson was born on April 21, 1930, in Olathe, Kan., to John and Helen
Knoll Tyson. They settled in Springdale, Ark., and his father began hauling
chickens from farms to markets in the Southeast and Midwest. The boy attended
public schools and at 14 started working for his father. After graduating from
Kemper Military School in Boonville, Mo., he enrolled at the University of
Arkansas, but quit in his senior year in 1952 to join the business, which had
added a hatchery and feed mill.
In 1952, he married Twilla Jean Womochil. He is survived by his son, John; three
daughters, Carla Tyson, Cheryl Tyson and Joslyn J. Caldwell-Tyson; and two
In 1957, the company built its first poultry-processing plant, and in the 1960s
began buying farms and competitors. It went public in 1963. Two years later, it
introduced Rock Cornish game hens, which became enormously popular and
profitable. Mr. Tyson became president in 1966 and chairman in 1967 after his
parents were killed in a car-train wreck.
Over the next three decades, Tyson grew exponentially. It bought beef, pork and
seafood companies, built 60 processing plants and diversified into 6,000
products. It supplied fast-food chains and secured markets abroad. When Mr.
Tyson surrendered day-to-day control in 1995, the company ranked 110th on the
Fortune 500 list, with sales of $5.2 billion.
Mr. Tyson supported Jimmy Carter, Bill Clinton and George W. Bush for president,
along with many charitable, educational and development programs. He called
himself a moderate Democrat, but went fishing with Republicans too, and made his
Baja California home available for legislative junkets.
“My theory about politics is that if they will just leave me alone, we’ll do
just fine,” he said in 1993. “We pretty much stay home and run chickens.”
September 21, 2010
The New York Times
By WILLIAM NEUMAN
On a July night in 1987, scores of elderly and chronically ill patients at
Bird S. Coler Memorial Hospital in New York City began to fall violently sick
with food poisoning from eggs tainted with salmonella.
“It was like a war zone,” said Dr. Philippe Tassy, the doctor on call as the
sickness started to rage through the hospital. By the time the outbreak ended
more than two weeks later, nine people had died and about 500 people had become
sick. It remains the deadliest outbreak in this country attributed to eggs
infected with the bacteria known as Salmonella enteritidis.
This year, the same bacteria sickened thousands of people nationwide and led to
the recall of half a billion eggs.
Despite the gap of decades, there is a crucial link between the two outbreaks:
in both cases, the eggs came from farms owned by Austin J. DeCoster, one of the
country’s biggest egg producers.
Mr. DeCoster’s frequent run-ins with regulators over labor, environmental and
immigration violations have been well cataloged. But the close connections
between Mr. DeCoster’s egg empire and the spread of salmonella in the United
States have received far less scrutiny.
While some state regulators took steps to clamp down on tainted eggs, the
federal government was much slower to act, despite entreaties from state
officials alarmed at the growing toll.
Farms tied to Mr. DeCoster were a primary source of Salmonella enteritidis in
the United States in the 1980s, when some of the first major outbreaks of human
illness from the bacteria in eggs occurred, according to health officials and
public records. At one point, New York and Maryland regulators believed DeCoster
eggs were such a threat that they banned sales of the eggs in their states.
“When we were in the thick of it, the name that came up again and again was
DeCoster Egg Farms,” said Paul A. Blake, who was head of the enteric diseases
division of the Centers for Disease Control and Prevention in the 1980s, when
investigators began to tackle the emerging problem of salmonella and eggs.
By the end of that decade, regulators in New York had forced Mr. DeCoster to
allow salmonella testing of his farms and, along with other states, pushed the
egg industry in the eastern United States to improve safety, which led to a drop
But the efforts were patchwork. For example, Iowa, where Mr. DeCoster has five
farms tied to the current outbreak, required no testing.
And the federal government, at times under pressure from Congress and the
industry to limit regulation, spent two decades debating national egg safety
standards. New rules finally went into effect in July — too late to prevent the
current round of illness.
Records released by Congressional investigators last week suggest that tougher
oversight of Mr. DeCoster’s Iowa operations might have prevented the outbreak,
which federal officials say is the largest of its type in the nation’s history,
with more than 1,600 reported illnesses and probably tens of thousands more that
have gone unreported.
According to the records, Mr. DeCoster’s farms in Iowa conducted tests from 2008
to 2010 that repeatedly showed strong indicators of possible toxic salmonella
contamination in his barns. Such environmental contamination does not always
spread to the eggs, and it is unclear what actions Mr. DeCoster took in
response. However, when the Food and Drug Administration inspected the farms
after the recalls, officials found unsanitary conditions and the presence of
Salmonella enteritidis in barns and feed.
“It’s striking that he was part of the early phase of the epidemic and that
there is now a problem on his farms in Iowa,” said Dr. Robert Tauxe, deputy
director of the foodborne illness division of the Centers for Disease Control.
Mr. DeCoster, also known as Jack, is expected to testify on Wednesday before the
House Subcommittee on Oversight and Investigations, which is looking into the
He has declined repeated requests for an interview since the egg recall began in
August. But Hinda Mitchell, a spokeswoman, said in an e-mail that his farms have
always “fully complied with the investigation and the orders from the states to
address these situations.”
Using an abbreviation for Salmonella enteritidis, she added, “We have committed
ourselves to doing more than what is required, and that absolutely means
following all SE surveillance programs, and other preventative measures, in the
states where we have, or have had, farms.”
Fifty years ago, Salmonella enteritidis (pronounced enter-IT-idis) was a minor
cause of illness. But in the late 1970s and early 1980s, the number of cases
began to grow worldwide. In this country, the Salmonella enteritidis epidemic
appeared first in New England, where Mr. DeCoster was the largest egg producer.
The first spike of illness there showed up in epidemiological records in 1979.
That same year, Mr. DeCoster sold his Maine operation, although it kept the name
DeCoster Egg Farms. He provided financing to the new owner, the Acton
Corporation, and some of his managers stayed to help run it, according to former
employees of the company. Mr. DeCoster began building new egg farms in Maryland.
The first enteritidis outbreak recognized by public health officials came in
July 1982, when about three dozen people fell ill and one person died at the
Edgewood Manor nursing home in Portsmouth, N.H. Investigators concluded that
runny scrambled eggs served at a Saturday breakfast were to blame. They traced
the eggs to what the Centers for Disease Control reports referred to as a large
producer in Maine; interviews with investigators confirmed that it was Mr.
DeCoster’s former operation.
Eggs from the same farms were also suspected in a simultaneous outbreak that
sickened some 400 people in Massachusetts.
Three years later, Mr. DeCoster bought back the Maine farms. By then, the
clusters of salmonella illness had begun to spread.
In 1987, the deadly outbreak at Coler Memorial Hospital on Roosevelt Island
occurred. Investigators determined that mayonnaise made from raw eggs had caused
the outbreak. They traced the eggs to Mr. DeCoster’s Maryland farms.
After two more outbreaks were linked to DeCoster eggs the following year, New
York banned Mr. DeCoster from selling eggs in the state. He was forced to agree
to a rigorous program of salmonella testing on his farms in Maine and Maryland.
Michael Opitz, a poultry expert retired from the University of Maine, said that
the testing found that a Maine breeder flock owned by Mr. DeCoster was infected,
meaning that hens there could be passing the bacteria to their chicks, which
might grow up to lay tainted eggs. Widespread contamination was also found in
Mr. DeCoster’s farms were not the only ones with problems. By the mid-1980s, the
bacteria had taken root in flocks in Pennsylvania and several other states. Soon
after moving against Mr. DeCoster, New York embargoed eggs from at least seven
The embargoes forced the industry to face the problem, and Pennsylvania took the
lead in fashioning a program to fight the bacteria. Scientists determined the
salmonella was entering eggs as they were formed in the ovaries of infected
hens. A plan of attack was gradually devised, including controlling rodents that
can harbor the bacteria, improving sanitation and vaccinating hens against
In 1991, tests revealed more salmonella contamination at one of Mr. DeCoster’s
farms in Maryland. The state quarantined the eggs, allowing them to be sold only
to a plant where they could be pasteurized to kill bacteria. Mr. DeCoster
challenged the order and a federal judge ruled that Maryland could not block him
from shipping eggs to other states. He was still barred from selling the eggs in
Maryland, and in 1992, a state judge found that he had violated the quarantine
by selling eggs to a local store; Mr. DeCoster was given a suspended sentence of
probation and a token fine.
Soon after interstate shipments resumed in 1992, eggs from the Maryland farm
caused a salmonella outbreak in Connecticut, according to a 1992 memo from the
Maryland attorney general’s office. Federal regulators insisted that Mr.
DeCoster decontaminate his barns.
Dr. Roger Olson, the former state veterinarian of Maryland, said that Mr.
DeCoster complained about the cost of testing and the quarantine and insisted
there was little risk associated with his eggs.
“We never really got an acknowledgment that he was causing a problem,” Dr. Olson
Mr. DeCoster sold his Maryland farms in 1993 and focused his attention on Iowa,
where he built his first laying barn in 1991. The state was attractive because
of its easy access to feed ingredients. And unlike Maryland and Maine, Iowa had
no requirements for salmonella monitoring.
Over the ensuing two decades, only Maine kept a close eye on salmonella at Mr.
DeCoster’s farms. Despite some improvements, state-supervised testing has shown
the persistent presence of the bacteria at several of his laying houses there,
according to state records.
Maine regulators became alarmed last year when toxic salmonella showed up again
in some barns that had tested clean for years. State veterinarian Dr. Donald
Hoenig ordered Mr. DeCoster to hire experts to devise a better prevention
program. The Maine facilities have now tested clean of enteritidis for the last
Dr. Hoenig said he wished that the federal government had stepped in sooner to
set standards for egg safety.
“The states were left on our own, with no federal oversight or guidance, to
regulate this bug as best we could,” he said.
August 30, 2010
The New York Times
By WILLIAM NEUMAN
Barns infested with flies, maggots and scurrying rodents, and overflowing
manure pits were among the widespread food safety problems that federal
inspectors found at a group of Iowa egg farms at the heart of a nationwide
recall and salmonella outbreak.
Inspection reports released by the Food and Drug Administration on Monday
described — often in nose-pinching detail — possible ways that salmonella could
have been spread undetected through the vast complexes of two companies.
The inspections, conducted over the last three weeks, were the first to check
compliance by large egg-producing companies with new federal egg safety rules
that were written well before the current outbreak, but went into effect only
“Clearly the observations here reflect significant deviations from what’s
expected,” said Michael R. Taylor, deputy commissioner for food for the F.D.A.
Mr. Taylor said that in response to the outbreak and recall, F.D.A. inspectors
would visit all of the 600 major egg-producing facilities in the country over
the next 15 months. Those farms, with 50,000 or more hens each, represent about
80 percent of nationwide egg production.
The recall, which began Aug. 13, involves more than half a billion eggs from the
Iowa operations of two leading egg producers, Wright County Egg and Hillandale
Farms. About 1,500 reported cases of Salmonella enteritidis have been linked to
tainted eggs since the spring — the largest known outbreak associated with that
strain of salmonella.
The F.D.A. inspection reports portray areas of filth and poor sanitation at both
operations, including many instances of rodents, wild birds or hens escaped from
cages — all of which can carry salmonella — appearing to have had free run of
It was difficult to gauge from the report how extensive the problems were. Both
companies operate vast facilities housing seven million hens. Wright County Egg
says inspectors visited 73 barns on its five egg farms.
Both companies said that they had acted quickly to correct problems and were
continuing to cooperate with regulators. The reports cited numerous instances in
which both companies had failed to follow through on basic measures meant to
keep chickens from becoming infected with salmonella, which can cause them to
lay eggs containing the bacteria.
“That is not good management, bottom line,” said Kenneth E. Anderson, a
professor of poultry science at North Carolina State University. “I am surprised
that an operation was being operated in that manner in this day and age.”
Inspection visits to Wright County Egg found barns with abundant rodent holes
and gaps in doors, siding and foundations where rodents could enter. Inspectors
spotted mice scampering about 11 laying houses.
Inspectors said that many of the barns lacked separate entrances, so that
workers had to walk through one barn to get into another — conditions that could
allow workers to track bacteria between barns. In addition, workers were seen
moving from barn to barn without changing protective clothing or cleaning tools.
The report on Wright County Egg also described pits beneath laying houses where
chicken manure was piled four to eight feet high. It also described hens that
had escaped from laying cages tracking through the manure.
Officials last week said that they were taking a close look at a feed mill
operated by Wright County Egg, after tests found salmonella in bone meal, a feed
ingredient, and in feed given to young birds, known as pullets. The young birds
were raised to become laying hens at both Wright County Egg and Hillandale.
The inspection report helped fill in the picture of the feed mill as a potential
source of contamination, saying that birds were seen roosting and flying about
the facility. (Officials said both wild birds and escaped hens were found at the
Nesting material was seen in parts of the mill, including the ingredient storage
area and an area where trucks were loaded. The report also said that there were
numerous holes in bins or other structures open to the outdoors. That included
the bin containing meat and bone meal that provided the feed ingredient sample
in which salmonella was found.
Officials said last week that they had found traces of salmonella similar to the
strain associated with the outbreak in a total of six test samples taken from
Wright County Egg facilities. That included the two feed tests and four tests
taken from walkways or other areas.
On Monday, officials said for the first time that they had also found salmonella
at a Hillandale facility. The bacteria was found in water that had been used to
The inspection report on Hillandale showed many problems similar to those found
at Wright County Egg, including hens tracking through manure piles and signs of
F.D.A. officials said they were not permitted to discuss possible enforcement
actions. But, according to Mr. Taylor, the law allows for civil actions like
injunctions as well as criminal prosecution.
“We are in the process of analyzing this evidence and considering what
enforcement actions would be appropriate,” Mr. Taylor said.
Officials said their investigation was continuing and they were not yet able to
say how the salmonella had gotten into the laying operations.
Wright County Egg is owned by Jack DeCoster, who has a long history of
environmental, labor and immigration violations at egg operations in Maine, Iowa
and elsewhere. The inspection report identified Mr. DeCoster’s son, Peter
DeCoster, as the chief operating officer of the Iowa operation.
Both companies have stopped selling shell eggs to consumers from their Iowa
facilities and instead are sending all their eggs to breaking plants where they
are pasteurized, which kills the bacteria. The eggs would then most likely be
sold in liquid form, possibly to food manufacturers.
Symptoms of salmonella include diarrhea, vomiting and stomach cramps. The
bacteria is killed by pasteurization or by thoroughly cooking the eggs.
August 19, 2010
The New York Times
By STEPHEN BUDIANSKY
IT’S 42 steps from my back door to the garden that keeps my family supplied nine
months of the year with a modest cornucopia of lettuce, beets, spinach, beans,
tomatoes, basil, corn, squash, brussels sprouts, the occasional celeriac and,
once when I was feeling particularly energetic, a couple of small but undeniable
artichokes. You’ll get no argument from me about the pleasures and advantages to
the palate and the spirit of eating what’s local, fresh and in season.
But the local food movement now threatens to devolve into another one of those
self-indulgent — and self-defeating — do-gooder dogmas. Arbitrary rules, without
any real scientific basis, are repeated as gospel by “locavores,” celebrity
chefs and mainstream environmental organizations. Words like “sustainability”
and “food-miles” are thrown around without any clear understanding of the larger
picture of energy and land use.
The result has been all kinds of absurdities. For instance, it is sinful in New
York City to buy a tomato grown in a California field because of the energy
spent to truck it across the country; it is virtuous to buy one grown in a
lavishly heated greenhouse in, say, the Hudson Valley.
The statistics brandished by local-food advocates to support such doctrinaire
assertions are always selective, usually misleading and often bogus. This is
particularly the case with respect to the energy costs of transporting food. One
popular and oft-repeated statistic is that it takes 36 (sometimes it’s 97)
calories of fossil fuel energy to bring one calorie of iceberg lettuce from
California to the East Coast. That’s an apples and oranges (or maybe apples and
rocks) comparison to begin with, because you can’t eat petroleum or burn iceberg
It is also an almost complete misrepresentation of reality, as those numbers
reflect the entire energy cost of producing lettuce from seed to dinner table,
not just transportation. Studies have shown that whether it’s grown in
California or Maine, or whether it’s organic or conventional, about 5,000
calories of energy go into one pound of lettuce. Given how efficient trains and
tractor-trailers are, shipping a head of lettuce across the country actually
adds next to nothing to the total energy bill.
It takes about a tablespoon of diesel fuel to move one pound of freight 3,000
miles by rail; that works out to about 100 calories of energy. If it goes by
truck, it’s about 300 calories, still a negligible amount in the overall
picture. (For those checking the calculations at home, these are “large
calories,” or kilocalories, the units used for food value.) Overall,
transportation accounts for about 14 percent of the total energy consumed by the
American food system.
Other favorite targets of sustainability advocates include the fertilizers and
chemicals used in modern farming. But their share of the food system’s energy
use is even lower, about 8 percent.
The real energy hog, it turns out, is not industrial agriculture at all, but you
and me. Home preparation and storage account for 32 percent of all energy use in
our food system, the largest component by far.
A single 10-mile round trip by car to the grocery store or the farmers’ market
will easily eat up about 14,000 calories of fossil fuel energy. Just running
your refrigerator for a week consumes 9,000 calories of energy. That assumes
it’s one of the latest high-efficiency models; otherwise, you can double that
figure. Cooking and running dishwashers, freezers and second or third
refrigerators (more than 25 percent of American households have more than one)
all add major hits. Indeed, households make up for 22 percent of all the energy
expenditures in the United States.
Agriculture, on the other hand, accounts for just 2 percent of our nation’s
energy usage; that energy is mainly devoted to running farm machinery and
manufacturing fertilizer. In return for that quite modest energy investment, we
have fed hundreds of millions of people, liberated tens of millions from
backbreaking manual labor and spared hundreds of millions of acres for nature
preserves, forests and parks that otherwise would have come under the plow.
Don’t forget the astonishing fact that the total land area of American farms
remains almost unchanged from a century ago, at a little under a billion acres,
even though those farms now feed three times as many Americans and export more
than 10 times as much as they did in 1910.
The best way to make the most of these truly precious resources of land,
favorable climates and human labor is to grow lettuce, oranges, wheat, peppers,
bananas, whatever, in the places where they grow best and with the most
efficient technologies — and then pay the relatively tiny energy cost to get
them to market, as we do with every other commodity in the economy. Sometimes
that means growing vegetables in your backyard. Sometimes that means buying
vegetables grown in California or Costa Rica.
Eating locally grown produce is a fine thing in many ways. But it is not an end
in itself, nor is it a virtue in itself. The relative pittance of our energy
budget that we spend on modern farming is one of the wisest energy investments
we can make, when we honestly look at what it returns to our land, our economy,
our environment and our well-being.
May 14, 2010
The New York Times
By PAMELA C. RONALD
and JAMES E. McWILLIAMS
A REPORT by the National Research Council last month gave ammunition to both
sides in the debate over the cultivation of genetically engineered crops. More
than 80 percent of the corn, soybeans and cotton grown in the United States is
genetically engineered, and the report details the “long and impressive list of
benefits” that has come from these crops, including improved soil quality,
reduced erosion and reduced insecticide use.
It also confirmed predictions that widespread cultivation of these crops would
lead to the emergence of weeds resistant to a commonly used herbicide,
glyphosate (marketed by Monsanto as Roundup). Predictably, both sides have done
what they do best when it comes to genetically engineered crops: they’ve argued
over the findings.
Lost in the din is the potential role this technology could play in the poorest
regions of the world — areas that will bear the brunt of climate change and the
difficult growing conditions it will bring. Indeed, buried deep in the council’s
report is an appeal to apply genetic engineering to a greater number of crops,
and for a greater diversity of purposes.
Appreciating this potential means recognizing that genetic engineering can be
used not just to modify major commodity crops in the West, but also to improve a
much wider range of crops that can be grown in difficult conditions throughout
Doing that also requires opponents to realize that by demonizing the technology,
they’ve hindered applications of genetic engineering that could save lives and
protect the environment.
Scientists at nonprofit institutions have been working for more than two decades
to genetically engineer seeds that could benefit farmers struggling with
ever-pervasive dry spells and old and novel pests. Drought-tolerant cassava,
insect-resistant cowpeas, fungus-resistant bananas, virus-resistant sweet
potatoes and high-yielding pearl millet are just a few examples of genetically
engineered foods that could improve the lives of the poor around the globe.
For example, researchers in the public domain have been working to engineer
sorghum crops that are resistant to both drought and an aggressively parasitic
African weed, Striga.
In a 1994 pilot project by the United States Agency for International
Development, an experimental variety of engineered sorghum had a yield four
times that of local varieties under adverse conditions. Sorghum, a native of the
continent, is a staple throughout Africa, and improved sorghum seeds would be
As well as enhancing yields, engineered seeds can make crops more nutritious. A
new variety of rice modified to produce high amounts of provitamin A, named
Golden Rice, will soon be available in the Philippines and, if marketed, would
almost assuredly save the lives of thousands of children suffering from vitamin
There’s also a sorghum breed that’s been genetically engineered to produce
micronutrients like zinc, and a potato designed to contain greater amounts of
To appreciate the value of genetic engineering, one need only examine the story
of papaya. In the early 1990s, Hawaii’s papaya industry was facing disaster
because of the deadly papaya ringspot virus. Its single-handed savior was a
breed engineered to be resistant to the virus. Without it, the state’s papaya
industry would have collapsed. Today, 80 percent of Hawaiian papaya is
genetically engineered, and there is still no conventional or organic method to
control ringspot virus.
The real significance of the papaya recovery is not that genetic engineering was
the most appropriate technology delivered at the right time, but rather that the
resistant papaya was introduced before the backlash against engineered crops
Opponents of genetically engineered crops have spent much of the last decade
stoking consumer distrust of this precise and safe technology, even though, as
the research council’s previous reports noted, engineered crops have harmed
neither human health nor the environment.
In doing so, they have pushed up regulatory costs to the point where the
technology is beyond the economic reach of small companies or foundations that
might otherwise develop a wider range of healthier crops for the neediest
farmers. European restrictions, for instance, make it virtually impossible for
scientists at small laboratories there to carry out field tests of engineered
As it now stands, opposition to genetic engineering has driven the technology
further into the hands of a few seed companies that can afford it, further
encouraging their monopolistic tendencies while leaving it out of reach for
those that want to use it for crops with low (or no) profit margins.
The stakes are too high for us not to make the best use of genetic engineering.
If we fail to invest responsibly in agricultural research, if we continue to
allow propaganda to trump science, then the potential for global agriculture to
be productive, diverse and sustainable will go unfulfilled. And it’s not those
of us here in the developed world who will suffer the direct consequences, but
rather the poorest and most vulnerable.
Pamela C. Ronald, a professor of plant pathology
at the University of
is the co-author of “Tomorrow’s Table: Organic Farming,
October 27, 2009
Filed at 3:03 a.m. ET
The New York Times
By THE ASSOCIATED PRESS
DES MOINES, Iowa (AP) -- After burning through $1 million in savings and
seeing no end to their losses, dairy farmers Jake and Lori Slegers figured they
didn't have much choice -- they had to kill the cows.
So one day last summer their sons tagged all 1,571 cows, loaded them onto
trailers at their farm south of Fresno, Calif., and watched them rumble away to
Lori Slegers said her husband came into the house and broke down.
''He said it was the hardest thing he ever had to do,'' she said. ''Luckily, my
boys could do it.''
Growing demand in developing nations drove up milk prices when times were good,
and dairy farmers expanded their herds. But the global recession hurt exports
and left farmers with too much milk on their hands. Milk processors cut the
price they were willing to pay farmers, in many cases below what it cost to
In the past year, hundreds of farmers have come to the same conclusion as the
Slegers: The only way to raise prices is to reduce the supply, and that means
killing cows. In some cases, whole herds have been turned into hamburger. In
others, farmers have kept their best producers and sent the rest to slaughter.
The Slegers turned to an industry-run program called Cooperatives Working
Together, or CWT, which pays farmers going out of business to kill -- rather
than sell -- their cows and help remaining dairy operations by reducing the milk
supply. Until this year, the 6-year-old program had paid for about 275,000 dairy
cows to be slaughtered. This year alone, it has paid for more than 225,000 to be
In addition, individual farmers are sending cows to slaughter at a pace of about
55,000 per week, said Robert Cropp, a professor emeritus at the University of
Wisconsin. At that rate, about 3 million cows could be killed in a year.
Lifelong dairy farmers Keith Sammon, 55, and his brother, Mark, 53, decided to
sell their herd to CWT last summer after considering the low milk prices, the
cost of modernizing their operation and some personal health issues.
Keith Sammon recalled the somber mood as he loaded the 80 cows onto livestock
trailers one Sunday morning at their farm in Faribault, Minn.
''As we milked the cows ... it was pretty quiet, but then my son came out with
my granddaughter, who was 10 months old and she was just beginning to walk
around. Just having her around made it easier,'' Keith Sammon said. ''We would
load the cows for a while and then go back and play with her for a while. It
kind of took your mind off of it.''
The slaughter has helped some. Dairy farms pay CWT 10 cents for every hundred
pounds of milk they produce. As the cows have been killed, the price processors
pay for milk has gone up an average of 66 cents per hundred pounds of milk, said
Scott Brown, an assistant research professor for dairy livestock at the
University of Missouri-Columbia.
Consumers haven't seen prices go up because processors still pay dairy farmers
much less than the retail price, Cropp said. In fact, grocery store prices may
still drop some because the milk supply remains much greater than the demand, he
That's because even as thousands of cows are killed and many farmers call it
quits, others are increasing their herds. In Wisconsin, the nation's
second-largest dairy producer after California, the number of cows increased to
about 1.25 million in August, up about 5,000 from the year before, according to
Most of the growth was the result of state tax credits and grants approved a
couple of years ago to help the industry modernize and expand. When those
credits were approved, the industry was booming.
Also, Wisconsin farmers haven't been hit as hard as those in western states such
as California, where farmers must buy more of their feed. High feed, utility and
other costs have compounded the losses created by the drop in milk prices.
CWT spokesman Christopher Galen said most of the cows slaughtered in the program
have come from western farms.
For the Slegers, the future is cloudy. They are still farming corn, sorghum and
winter oats this year but are looking at moving away and starting over. They're
not sure what they would do.
''We still don't know if it was the smartest move we ever made,'' Lori Slegers
said. ''One day, when the dairy business turns around, will we kick ourselves?
We promised we wouldn't do that.''
IF climate change and population growth progress at their current pace, in
roughly 50 years farming as we know it will no longer exist. This means that the
majority of people could soon be without enough food or water. But there is a
solution that is surprisingly within reach: Move most farming into cities, and
grow crops in tall, specially constructed buildings. It’s called vertical
The floods and droughts that have come with climate change are wreaking havoc on
traditional farmland. Three recent floods (in 1993, 2007 and 2008) cost the
United States billions of dollars in lost crops, with even more devastating
losses in topsoil. Changes in rain patterns and temperature could diminish
India’s agricultural output by 30 percent by the end of the century.
What’s more, population increases will soon cause our farmers to run out of
land. The amount of arable land per person decreased from about an acre in 1970
to roughly half an acre in 2000 and is projected to decline to about a third of
an acre by 2050, according to the United Nations. With billions more people on
the way, before we know it the traditional soil-based farming model developed
over the last 12,000 years will no longer be a sustainable option.
Irrigation now claims some 70 percent of the fresh water that we use. After
applying this water to crops, the excess agricultural runoff, contaminated with
silt, pesticides, herbicides and fertilizers, is unfit for reuse. The developed
world must find new agricultural approaches before the world’s hungriest come
knocking on its door for a glass of clean water and a plate of disease-free rice
Imagine a farm right in the middle of a major city. Food production would take
advantage of hydroponic and aeroponic technologies. Both methods are soil-free.
Hydroponics allows us to grow plants in a water-and-nutrient solution, while
aeroponics grows them in a nutrient-laden mist. These methods use far less water
than conventional cultivation techniques, in some cases as much as 90 percent
Now apply the vertical farm concept to countries that are water-challenged — the
Middle East readily comes to mind — and suddenly things look less hopeless. For
this reason the world’s very first vertical farm may be established there,
although the idea has garnered considerable interest from architects and
governments all over the world.
Vertical farms are now feasible, in large part because of a robust global
greenhouse initiative that has enjoyed considerable commercial success over the
last 10 years. (Disclosure: I’ve started a business to build vertical farms.)
There is a rising consumer demand for locally grown vegetables and fruits, as
well as intense urban-farming activity in cities throughout the United States.
Vertical farms would not only revolutionize and improve urban life but also
revitalize land that was damaged by traditional farming. For every indoor acre
farmed, some 10 to 20 outdoor acres of farmland could be allowed to return to
their original ecological state (mostly hardwood forest). Abandoned farms do
this free of charge, with no human help required.
A vertical farm would behave like a functional ecosystem, in which waste was
recycled and the water used in hydroponics and aeroponics was recaptured by
dehumidification and used over and over again. The technologies needed to create
a vertical farm are currently being used in controlled-environment agriculture
facilities but have not been integrated into a seamless source of food
production in urban high-rise buildings.
Such buildings, by the way, are not the only structures that could house
vertical farms. Farms of various dimensions and crop yields could be built into
a variety of urban settings — from schools, restaurants and hospitals to the
upper floors of apartment complexes. By supplying a continuous quantity of fresh
vegetables and fruits to city dwellers, these farms would help combat health
problems, like Type II diabetes and obesity, that arise in part from the lack of
quality produce in our diet.
The list of benefits is long. Vertical farms would produce crops year-round that
contain no agro-chemicals. Fish and poultry could also be raised indoors. The
farms would greatly reduce fossil-fuel use and greenhouse-gas emissions, since
they would eliminate the need for heavy farm machinery and trucks that deliver
food from farm to fork. (Wouldn’t it be great if everything on your plate came
from around the corner, rather than from hundreds to thousands of miles away?)
Vertical farming could finally put an end to agricultural runoff, a major source
of water pollution. Crops would never again be destroyed by floods or droughts.
New employment opportunities for vertical farm managers and workers would
abound, and abandoned city properties would become productive once again.
Vertical farms would also make cities more pleasant places to live. The
structures themselves would be things of beauty and grace. In order to allow
plants to capture passive sunlight, walls and ceilings would be completely
transparent. So from a distance, it would look as if there were gardens
suspended in space.
City dwellers would also be able to breathe easier — quite literally. Vertical
farms would bring a great concentration of plants into cities. These plants
would absorb carbon dioxide produced by automobile emissions and give off oxygen
in return. So imagine you wanted to build the first vertical farm and put it in
New York City. What would it take? We have the technology — now we need money,
political will and, of course, proof that this concept can work. That’s why a
prototype would be a good place to start. I estimate that constructing a
five-story farm, taking up one-eighth of a square city block, would cost $20
million to $30 million. Part of the financing should come from the city
government, as a vertical farm would go a long way toward achieving Mayor
Michael Bloomberg’s goal of a green New York City by 2030. Manhattan Borough
President Scott Stringer has already expressed interest in having a vertical
farm in the city. City officials should be interested. If a farm is located
where the public can easily visit it, the iconic building could generate
significant tourist dollars, on top of revenue from the sales of its produce.
But most of the financing should come from private sources, including groups
controlling venture-capital funds. The real money would flow once entrepreneurs
and clean-tech investors realize how much profit there is to be made in urban
farming. Imagine a farm in which crop production is not limited by seasons or
adverse weather events. Sales could be made in advance because crop-production
levels could be guaranteed, thanks to the predictable nature of indoor
agriculture. An actual indoor farm developed at Cornell University growing
hydroponic lettuce was able to produce as many as 68 heads per square foot per
year. At a retail price in New York of up to $2.50 a head for hydroponic
lettuce, you can easily do the math and project profitability for other similar
When people ask me why the world still does not have a single vertical farm, I
just raise my eyebrows and shrug my shoulders. Perhaps people just need to see
proof that farms can grow several stories high. As soon as the first city takes
that leap of faith, the world’s first vertical farm could be less than a year
away from coming to the aid of a hungry, thirsty world. Not a moment too soon.
Dickson D. Despommier,
a professor of public health at Columbia University,
CHICAGO (AP) -- Agriculture futures strengthened Friday on the Chicago Board
of Trade, with corn leading the move higher.
Wheat for December delivery rose 3 cents to $8.05 a bushel; December corn rose
6.75 cents to $3.73 a bushel; December oats gained 4 cents to $2.82 a bushel;
January soybeans added 9.75 cents to $10.2225 a bushel.
Beef futures were mixed while pork futures rose on the Chicago Mercantile
December live cattle rose 0.1 cent to 96.35 cents a pound; November feeder
cattle fell 0.47 cent to $1.093 a pound; December lean hogs rose 0.3 cent to
54.9 cents a pound; February pork bellies gained 0.98 cent to 81.5 cents a
Iowa, Sept. 24 — The ethanol boom of recent years — which spurred a frenzy of
distillery construction, record corn prices, rising food prices and hopes of a
new future for rural America — may be fading.
Only last year, farmers here spoke of a biofuel gold rush, and they rejoiced as
prices for ethanol and the corn used to produce it set records.
But companies and farm cooperatives have built so many distilleries so quickly
that the ethanol market is suddenly plagued by a glut, in part because the means
to distribute it has not kept pace. The average national ethanol price on the
spot market has plunged 30 percent since May, with the decline escalating
sharply in the last few weeks.
“The end of the ethanol boom is possibly in sight and may already be here,” said
Neil E. Harl, an economics professor emeritus at Iowa State University who
lectures on ethanol and is a consultant for producers. “This is a dangerous time
for people who are making investments.”
While generous government support is expected to keep the output of ethanol fuel
growing, the poorly planned overexpansion of the industry raises questions about
its ability to fulfill the hopes of President Bush and other policy makers to
serve as a serious antidote to the nation’s heavy reliance on foreign oil.
And if the bust becomes worse, candidates for president could be put on the spot
to pledge even more federal support for the industry, particularly here in Iowa,
whose caucus in January is the first contest in the presidential nominating
Many industry experts say the worst problems are temporary and have been
intensified by transportation bottlenecks in getting ethanol from the heartland
to the coasts, where it is needed most. And even if some farmers who invested in
the plants lose money, most of them are reaping a separate bounty from higher
prices for corn and other commodities, which are expected to remain elevated for
Even so, companies are already shelving plans for expansion and canceling new
plant construction. If prices fall more, as many analysts predict, there is
likely to be a sweeping consolidation of the industry, and some smaller
companies could go out of business.
The falling price of ethanol comes in sharp contrast to the rise in crude oil
prices. Lower ethanol prices help reduce gasoline prices at the pump, where
ethanol is available, but because it constitutes 10 percent or less in most
blends, the impact for the consumer is marginal.
Congress essentially legislated the industry’s expansion by requiring steadily
higher quantities of ethanol as a gasoline blend, a kick-start that was further
spurred by the proliferation of bans on a competing fuel additive used to help
curb air pollution.
But the ethanol industry, which is also heavily subsidized by federal tax
incentives, got far ahead of the requirements of the law, rapidly building
scores of plants and snapping up a rising share of the corn harvest. Many of
those plants have gone into operation in recent months, and many more are
scheduled for completion by the end of next year.
The resulting ethanol oversupply is buffeting the market. Here in northern Iowa,
deep in the corn belt, newly cautious farmers and ethanol executives are
figuring out how to cut costs and weighing their options should the situation
“We don’t know what, ultimately, the marketplace will price ethanol at,” said
Rick Brehm, president and chief executive of Lincolnway Energy, a midsize
distillery here. “It could go lower.”
Since construction crews broke ground on the Lincolnway plant in 2005, the price
of ethanol on the local market has fallen to $1.55 a gallon from about $2, Mr.
Brehm said. Over the same period, the price of corn, representing 70 percent of
production costs, has risen to $3.27 a bushel from $1.60. “We’re trapped between
two commodities,” he said.
Lincolnway was once virtually alone in the region, but now a handful of new
competing distilleries are operating and pouring even more ethanol onto the
market, offering blenders more options to negotiate lower prices and driving up
demand for corn.
“Obviously, I’m concerned about where we’re going,” said Bill Couser, chairman
of Lincolnway Energy, though he added that his company is still making money and
he is optimistic about the future.
The ethanol boom was set off when Congress enacted an energy law in 2005 that
included a national mandate for the use of renewable fuel in gasoline, obliging
the market to consume 7.5 billion gallons a year by 2012, compared with 3.5
billion gallons in 2004.
Already, ethanol producers are poised to outpace that mandate, with capacity
expected to reach 7.8 million gallons by the end of 2007 and 11.5 billion
gallons by 2009, although some in the industry are now predicting that the
expansion could slow.
The number of ethanol plants in the country has increased to 129 today from 81
in January 2005, according to the Renewable Fuels Association, while plants
under construction or expanding have mushroomed to about 80 from 16 during the
“As ethanol supply increases over the next 12 months, the challenge will be to
find a home for it,” said Mark Flannery, head of energy equity research at
Credit Suisse. “The ethanol surplus is here already.”
Because ethanol is corrosive and soaks up water and impurities, it cannot be
shipped through the country’s fuel pipeline network. So it must be transported
by train, truck and barge, a more expensive transportation network that is
suddenly finding it hard to keep up with the surge in ethanol production.
There is a long backlog in orders for specialized ethanol rail cars to ship the
surplus production. Many rail terminals at the ethanol plants do not have spurs
large enough to accommodate the long trains that ethanol promoters like to call
“virtual pipelines.” And pumps from the storage tanks to the rail cars at the
terminals often do not have sufficient capacity to load trains quickly and
Phillip C. Baumel, economics professor emeritus at Iowa State University, said
that in many cases ethanol producers ramped up their production so rapidly that
they gave “inadequate attention to meeting transportation and distribution
Gasoline wholesale marketers have been slow to gear up ethanol blending
terminals, in part because they had to invest simultaneously in equipment to
manage low sulfur diesel and tougher product specifications.
Prices of ethanol range widely around the country, even differing from one
county to the next in the same state on a daily basis. [The average rack, or
wholesale, price reported by the DTN Ethanol Center on Tuesday was $2.42 a
gallon in New York and $1.77 in Iowa.] Generally, prices are highest in states
farthest away from the Midwest farm belt and in ones that have federal or state
clean-air requirements that encourage the use of ethanol.
In a new study, the Agriculture Department warned of “several supply chain
issues that could inhibit growth in the ethanol industry,” including a backlog
in rail tank car orders that grew to 36,166 rail cars by the end of the first
quarter in 2007 from about 10,000 in the third quarter of 2005.
“You just can’t scale it up overnight,” said Chuck Baker, vice president and
executive director of the National Railroad Construction and Maintenance
Stiff blending regulations in some southern states like Florida have also been
an impediment to ethanol. And so far, only about 1,000 of the 179,000 pumps at
gasoline stations around the country offer E-85, a fuel that is 85 percent
ethanol and 15 percent gasoline, intended for the five million flex-fuel
vehicles on the road that can run on high ethanol blends.
Major ethanol producers and lobbyists describe the developing gulf between
production output and transport capacity as a temporary growing pain that will
be alleviated over time.
“We have an industry that has doubled in size in just the past couple of years,”
said Bob Dinneen, president of the Renewable Fuels Association. “It is going to
take a little time for the infrastructure to catch up.”
Some analysts outside the industry think the current market upheaval may be more
than simply a hiccup.
Aaron Brady, a director at the consulting firm Cambridge Energy Research
Associates, said the current market problems could worsen if combined with other
“unintended consequences that may be lurking” from increased ethanol production.
He said pressure on corn and other food prices, water shortages, soil and
fertilizer runoff could hurt political support for the industry.
“If Congress doesn’t substantially raise the renewable fuel standard,” Mr. Brady
said, “then this is not just a short term problem but a long term issue, and
there will be more of a shakeout in the industry.”
The Senate has approved a bill that would require gasoline producers to blend 36
billion gallons of ethanol into gasoline by 2022, an increase from the current
standard of 7.5 billion gallons by 2012. The House did not include such a
provision in the version it passed, and it is uncertain whether any final
legislation will emerge this year and what it will say about ethanol if it does.
Ethanol proponents say a new energy law is virtually inevitable at some point,
and that even if it does not pass this year, lower ethanol prices will provide
an incentive for refiners to blend more ethanol into expensive gasoline. A
higher renewable fuels standard would force refiners and blenders to work faster
to process increased amounts.
A strong energy law would also increase investment and research into ethanol
production from nonfood sources, like switch grass, and persuade auto companies
to make more cars that run on blends well beyond the standard low percentage
ethanol mixture, ethanol proponents argue.
“This is an industry that is going to continue to grow,” said Bruce Rastetter,
chief executive of Hawkeye Renewables, a private company based in nearby Ames
that has two distilleries and two more under construction. “Once you see an
energy bill, I think you will see the industry respond again.” (Still, he has
dropped plans to build a fifth plant and take Hawkeye public.)
CHICAGO (AP) -- Wheat, corn and soybean prices rose Wednesday on the Chicago
Board of Trade.
Wheat for December delivery rose 10.75 cents to $8.98 a bushel; December corn
rose 2.75 cents to $3.745 a bushel; December oats dipped 1 cent to $2.805 a
bushel; November soybeans jumped 16 cents to $9.89 a bushel.
Beef futures rose and pork futures were mixed on the Chicago Mercantile
October live cattle rose 0.18 cent to 97.75 cents a pound; October feeder cattle
rose 0.23 cent to $1.163 a pound; October lean hogs fell 0.25 cent to 60.75
cents a pound; February pork bellies rose 0.58 cent to 89.3 cents a pound.