I usually start my morning by browsing the latest news, markets, and even the latest facebook posts from my friends. As most of us get a little older, it not only takes a little more time to get the engine warmed up in the morning, we place a higher value on routine. This routine has served more than my tendency to procrastinate. It allows me an opportunity to gather my thoughts, keep in touch with what is going on and at least subconsciously plan my day a little better. Sometimes my plan backfires and I read an article that instead of getting my engine warmed up, it steps on the throttle and makes my mind race at full speed, sometimes because it gives me a new idea to try to incorporate but often because the news just hits me in all the wrong places. Yesterday, when I read the latest Drover’s article about whether the animal activists were in fact winning the war in their efforts to force change in production methods, it initially just made my blood boil. Others in agriculture had the same initial impression even going as far as condemneing the popular ag magazine as venturing towards treason against the industry. Others not in agriculture seemed surprised to see this position in an ag magazine.
So was this treason or reason? The article brought up two major points. First, are some of the more extreme and vocal opponents of agriculture now becoming the principle source of information for not only the popular press but even many consumers? Secondly, if some practices used by agriculture are very difficult to defend, does it make sense to eliminate those practices in order to appease the majority of consumers? Even if a majority of consumers want a certain minimum standard imposing the majority view may have detrimental effects on the minority. As it relates to higher welfare standards if it substantially increases costs and therefore affordability it disproportionately impacts those who are the least food secure. Whether we like it or not we have to accept that todays typical consumer is more engaged and concerned about food production systems and that has not only provided a new opportunity for some farmers it also could pose some real threats to both individual farmers continuing to be able to do what they love and to overall food security. A good argument is that it is unwise to make our principle welfare and production systems based on the views of those often far removed from agriculture instead of based on our own experiences and the research of those who specialize in animal behavior. It is even more unwise to totally dismiss consumer sentiment.
As an economist, my view is always going to be that ultimately the market is the best way to sort out consumer tastes and preferences over the long term instead of ballot initiatives and legislation that is easily influenced by emotional appeals and whomever has the biggest checkbook to lobby for or against a measure. If sufficient numbers of consumers want their eggs produced by chickens who get a feather wash and blow dried each morning and they are willing to pay a price that will allow a producer to recover his costs plus a reasonable return on his investment, America’s farmers will be glad to supply exactly that product. There is no other industry that has been as innovative in meeting the customers’ demands at affordable prices.
Taken very literally, the Drover’s article could have been a sign of defeat. On the other hand what I believe was illustrated in this Drover’s article was not concession, but simply recognizing that many of our customers see the glass as only half empty, when we as producers tend to see the glass half full. Should we be looking for improvements in the current system that maximizes the benefits while trying to mitigate the costs and consequences or should we do as the recent Chipolte advertisement suggests and go back to the start? A reversion to the methods of our great grandparents could have disastrous consequences. When my father was just becoming an adult, President Truman said that without significant increases in productivity or a significant curtailment of population growth, it was possible that half of the world could face starvation. When I was barely old enough to walk in 1968, the best selling book was The Population Bomb by Paul Ehrlich which predicted widespread famine, social unrest and upheaval due to the inability to grow food faster than the population was growing. Neither of these predictions came to pass only because we were able to adapt new technology and methods that allowed us to slingshot productivity growth at a rate much faster than population growth. We had four billion people in the world then, today we have seven billion and fewer resources to produce our food. Do we really want to go back to a time when the principle concern was whether there was enough food to go around and if there was, would we be able to afford it?
While I support consumer choice as the principle driver of determining production systems, there has to be limits to choice. Just because a particular sadistic consumer may want to buy meat from an animal that has been beaten and abused doesn’t justify the market providing that choice. There has to be minimal acceptable standards. Beyond those minimums, the choice of production system by an individual producer has to be the result of a complex balance between meeting the preferences and demands of his customers, utilizing his own skills and resources, and having a system that is financially sustainable with a minimum of long term costs and consequences. How that we determine what minimum standards are acceptable is a question that has many different possible answers. Who gets to determine those standards become an even more difficult question. Future blogs will cover these questions in more detail at least from my perspective as an economist, producer and a consumer.
As producers, we cannot ignore consumers. They are our customers and their views should be recognized and incorporated into our systems as much as possible without jeopardizing other important aspects of production including protection and health of our livestock, productivity at levels that sustain food security and at least enough profitability that we can continue to invest in our operations and continue to be innovative to keep re-engineering the wheel.
Instead of simply conceding these production methods to our most vocal critics like the Drover’s article seems to suggest, why not develop a system to determine what should be the minimum standards should be in a way that consumers can easily understand? If we ask these questions about each production system it is much easier to start to more effectively communicate our message to the consumer and in the process make them a stakeholder in the decision process while still having our principle objective of using the production systems that provide the right balance between all objectives.
1) Is there a viable alternative that is more palatable but yet does not jeopardize long term food security and affordability i.e. enriched colonies.
2) Is there a modification to the current system that could substantially increase one attribute while retaining substantially all of that systems current benefits i.e. freedom gestation crates.
3) Does that system improve the perception to the consumer and what increased price is the consumer willing to pay for that product for that increased perception.
If we can develop a decision making process to determine minimum acceptable standards that balances all of those aspects in a way that the typical consumer can understand even if it means shifting or tweaking some of our standard production practices over time, it is likely that our message will resonate with them without jeopardizing food security and still making the principle determination based on our own ingenuity and ability to evolve our systems to meet changing consumer tastes and preferences.
Ultimately, this issue continues to be one of consumer tastes and preferences, not one where the most extreme views have gained enough credibility to impose their own will on everyone else. If a large majority of consumers were willing to pay a substantial premium for cage free eggs and would buy only those eggs, there wouldn’t be a lot of battery cages left in the county. The problem with legislating minimum standards is that it eliminates choice for the consumer. If we can communicate more effectively why different systems increase the cost of food and consumers indicate their preferences by spending with their pocketbook instead of answering a survey that only addresses one aspect of the issue, over time production systems would evolve to exactly meet those needs while not eliminating the choices for those who either cannot afford or do not have that particular attribute as their highest priority.