Agriculture, Industrialized

Industrialization of Agriculture

Industrialization includes the mechanization of processes previously done by human hands. It also involves the reorganization of labor practices and the application of new energy and transportation technologies to increase the rate at which humans transform nature into goods. Increased output also requires new markets. Hence, the industrialization of agriculture involves widespread change in four areas: (1) supply of farmland, (2) public policy, (3) technological change, and (4) agribusiness consolidation along the value chain.

Prior to the 20th century, American farmers practiced an extensive form of agriculture. As demand for food increased, farmers expanded into new territory. New plows invented by John Deere made it easier to till fertile but heavy prairie soils. However, agricultural production increased because more acres were planted, not because yields per acre increased during this time. Conditions changed when the frontier closed at the end of the 19th century. With no new land to cultivate, output could grow only through increasing yields. This marked the beginning of intensive agriculture.

Public policy decisions created a foundation for industrial agriculture. The U.S. Department of Agriculture (USDA) was established in 1862. In the same year, the Morrill Act stipulated that each state should have one “land grant” college where agricultural sciences could be taught. During the early 20th century, political leaders noticed that American agricultural productivity lagged behind that of England and Germany. President Theodore Roosevelt launched the Country Life Commission, which concluded that productivity could increase only if the infrastructure of rural America was modernized. Recommendations included reforming rural schools to teach students agronomy and improving the road system to better transport produce to markets. The USDA continues to promote industrial agriculture through subsidies, research, and supply management, for example, by redistributing surplus commodities through the Food Stamp program.

Productivity increased dramatically through the mechanization of farms. In 1910, there were an estimated 1,000 tractors in use. By 1940, that number had risen to 1.6 million—a number that tripled to 4.8 million by 1965. Increasing horsepower and tractor versatility also contributed to productivity increases. Wheat and corn yields were 15.4 and 30.0 bushels per acre, respectively, in 1940. By 1970, the corresponding numbers had more than doubled to 31.8 and 80.8 bushels per acre. Productivity increases also occurred because of advances in genetic engineering, pesticides, and fertilizers, among other farm inputs.

Industrialization has transformed the agricultural sector beyond the farm as well. As a raw commodity[Page 4] such as corn leaves the farm, it follows a so-called value chain that includes processing, distribution, and retail on its way to consumers. At each step, value is added to the commodity as it is transformed into products and moved closer to consumers. The problem for farmers is that large agribusinesses are working to control more and more of the value chain. Multinational firms (e.g., ConAgra, Cargill) sell inputs such as fertilizer, but they also process commodities. Under these increasingly monopolistic conditions, farmers have less bargaining power to affect the price of inputs they must buy or the crops they must sell. In the end, farmers earn a smaller portion of each dollar spent by consumers because the prices that farmers receive for their crops have stagnated, even though the prices that consumers pay continue to increase.

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