Thursday, February 28, 2008

Stuff I heard...

Over the roar at the Trade Show at the Commodity Classic. Whoa - they'll have to start serving decaf to this crowd before it gets untidy. I've been to several hundred Commodity Classics and this is the rowdiest by far.

Could it be the continuing rally made possible by yours truly?

Anyhoo, things I took aboard.
  • Some ground within a hundred miles of me sold for $8800. That's for every single acre.
  • I'm not quite the fool I thought I was for renegotiating my contracts this year for what seemed like astronomical rents at the time.
  • Some students at UM are live blogging the Classic. Find Whitney's blog here.
  • No, I don't know if she has a boyfriend. I'm just glad we had sons, because I'm pretty sure this type of offspring would be beyond my management expertise.
  • I talked with the head of global commerce for Monsanto. Halfway through our discussion it hit me how much both of us has at risk from the rising tide of protectionism. I'll post more about this later, but I'm dismayed by sentiments from both sides of the aisle about NAFTA and free trade in general.
  • This is the largest Classic ever, which is amazing since Las Vegas seems to bring out the biggest crowds.
  • I saw my sprayer. I just traded for the exact sprayer sitting on the display floor. And the pathetic reason why I traded a 2005 model with 207 hours and no problems? To get a seat in the cab for my grandson, now that he is back on the farm. Sometimes you have to know what values to put on things.

  • I heard three stories about small elevators on the brink of something not very good. We could be heading for a straight cash market for many grain originators.
  • I really think producers are missing something important (and I don't mean me) when they don't take the chance to attend meetings like this. I learn more about the state of our business sector in two days here than two weeks at the computer.
More later. I think I heard a wine cork popped.

Hey - it's an agricultural product. In fact, one of our major ag exports.

Why we're having trouble with the markets...

Contrary to popular belief, having lots of choices can be more difficult to manage than limited choices. Producers trying to decide their crop mix and sales options are going crazy making decisions.This won't help. A simple game that illustrates the mixed blessing of multiple choices.


In fact, because of the prosperity raining down on parts of agriculture, I think you can count on some very irrational decisions being made.
What they saw was the power of expectations. People expect expensive wines to taste better, and then their brains literally make it so. Wine lovers shouldn't feel singled out: Antonio Rangel, the Caltech neuroeconomist who led the study, insists that he could have used a variety of items to get similar results, from bottled water to modern art.

Expectations have long been a topic of psychological research, and it's well known that they affect how we react to events, or how we respond to medication. But in recent years, scientists have been intensively studying how expectations shape our direct experience of the world, what we taste, feel, and hear. The findings have been surprising - did you know that generic drugs can be less effective merely because they cost less? - and it's now becoming clear just how pervasive the effects of expectation are.

The human brain, research suggests, isn't built for objectivity. The brain doesn't passively take in perceptions. Rather, brain regions involved in developing expectations can systematically alter the activity of areas involved in sensation. The cortex is "cooking the books," adjusting its own inputs depending on what it expects.

Although much of this research has been done by scientists interested in marketing and consumer decisions, the work has broad implications. People assume that they perceive reality as it is, that our senses accurately record the outside world. Yet the science suggests that, in important ways, people experience reality not as it is, but as they expect it to be. [More]
This is why vendors have astonishing pricing power right now. Even if we do pay through the nose for products that deliver few, if any benefits beyond the competition, our brains will make sure we think they do.

Get your buying done now, because the input inflation is just beginning to spawn in our brains, IMHO.

Wednesday, February 27, 2008

Stuff my bother-in-law forwards to me...

Every now and then there's a keeper.

Stick with it to the end for the octopus.

Of course this is only going to encourage him...

[Thanks, Jerry]
Off to the Classic!...

I'm leaving at 0h-dark-thirty tomorrow to attend the Commodity Classic and perform my favorite role: emcee the General Session. While we have Big Names in attendance - political analyst Charlie Cook and brand-new Secretary of Agriculture Ed Shafer - I frankly am more interested in what the three commodity presidents will say when we talk together.

We're all going where no farmer has gone before and I get most of my great ideas from colleagues like them.

Hope I see you there. If not, I'll be blogging about what happens as I can.
Count the noses, folks...

One interesting note about campaign promises that stuck with me this week is the idea of eliminating the income cap on SS taxes (Schedule SE for farmers) such that the wealthy pay SS on all their income, just like they do for Medicare. It's a legitimate idea, and has been put forward as one possible part of a solution to Social Security by several voices. During a campaign, those voices get listened to more closely, however.
Clinton called Obama's proposal to raise Social Security taxes on earnings over $97,500 per year, the current upper limit on which any tax is levied, a trillion-dollar increase on "middle class families."

Clinton: I do not want to fix the problems of Social Security on the backs of middle class families and seniors. (Applause.) If you lift the cap completely, that is a $1 trillion tax increase. I don't think we need to do that.

ClintonTaxing all earnings would indeed amount to a $1.3 trillion increase over the next 10 years alone, according to estimates by Cato Institute Social Security expert Michael Tanner, who says he drew his figures from projections by the Social Security Administration staff. A similar estimate comes from Citizens for Tax Justice, which figures the measure would bring in $124 billion per year.

Obama defended his proposal by saying it would fall only on the "upper class."

Obama: I've heard you say this is a trillion dollar tax cut on the middle class by adjusting the cap. Understand that only 6 percent of Americans make more than $97,000 — (cheers, applause) — so 6 percent is not the middle class — it's the upper class.

Clinton responded by saying that some of her New York constituents would still find the increase burdensome. "I represent firefighters. I represent school supervisors," she said. [More]
But since Barack Obama suggested it, some attorneys in New York have realized its true impact.
But how will Obama affect BigLaw wallets? On Above the Law, we regularly see commenters threaten to abandon law firms for falling $5,000/year short of market. I therefore thought it worthwhile to examine the effects of Obama’s tax and spending plans on take-home pay.

We all know that Obama wants to end the Bush tax cuts. That is a 3% bump across the board to the bad old days when associates faced a marginal federal tax rate of 36%.

But the real hidden tax is that Obama plans to end the social-security tax cap. Right now, you may notice, sometime during the summer or early fall, your take-home pay suddenly goes up because they stop deducting FICA. Current law caps social security taxes: in 2008, the cap is at $102,000. Obama proposes to abolish this. That mid-summer bump will be no more: add about several thousand dollars to your annual tax bill.

But social-security taxes are not only on employees. The government also charges 6.2% to employers that you never see on your W-2s. But rest assured the partners see this, and will notice that the expense of keeping an associate has risen several thousand dollars a year when FICA taxes double and triple. Will they swallow that additional expense, or take it out of your bonus? [More legal hysteria - read a few comments]
This analysis is fundamentally sound, I think, and will have ramifications for farmers as well. But what has gone unnoticed by most making salaries that would see this increase is how few other Americans have been able to join their ranks and thus constitute a credible voting bloc.

Oh sure, they could buy influence and will with campaign contributions, soft money, etc. but the lopsided national income distribution we now have to cope with means most will weep crocodile tears for these poor legal beagles struggling with their $280,000 incomes.

But back to farmers. If payment limitations become a real possibility, and spouses get enlisted to haul in some subsidies, there could be a serious trade-off in SS taxes paid and subsidies actually received.

Now what if payments are cut to fund other farm bill priorities? The trade-off becomes trickier if a spouse has either a significant non-farm income or is assigned a significant portion of farm income.

Prosperity on the farm is tough to reconcile with a tax system that redistributes downstream.
Competition check...

Some of the sites I monitor have occasional references to international developments in agriculture. In the interest of understanding what may be going on with our counterparts around the world, I'm going to try to feature some stories that give you a taste of farming elsewhere without having to leave the house.

Zaraysk, Russia - Three hours outside Moscow, where snowy weeds bow to the bitter wind, salvation has come. It's not pretty; in fact, it really smells. But for the 27 people who work inside the steamy barns of this new pig farm, life just got a whole lot better. "We worked at a socialist farm before coming here. The labor conditions were zero and the salary was low," says Natalya Kuskova, a team leader who now gets five weeks of vacation to spend with her daughter. "Our farm is so wonderful; they pay for lunch … and the attitude toward us is very good; it inspires you to work." The operation, valued at $29 million, was funded by a Spanish outfit and is expected to pay off that investment in six to seven years. It is part of a boom in agriculture across Russia, where land is 20 times cheaper than in Europe, and a two-year-old government initiative offers virtually interest-free credit to investors. One of five "national projects" implemented under President Vladimir Putin, the agriculture push is aimed at increasing production and reviving the countryside. [More]
It is important not to make generalizations from singular stories like this, but by the time we get good data on trends in distant economies, we can have a full-blown market disrupter like Brazil and eveybody is asking "Where did they come from?"

The important fact for me in this article is the Spanish ownership/investment. It fits with what I have heard in Denmark as farmers there (especially young farmers) decamp to eastern Europe, etc. in search of a chance to own some land and farm. Kinda like the handful of Americans in Brazil.

For a profession that used to stay put, farmers seem remarkably mobile today.
Who's trippin' down the streets of the city?*...

On the bright side, at the time it was making about 42 MW of power.

*Everyone knows it's windy.

[via Presurfer]

Tuesday, February 26, 2008

This was my future...

I was 8 years old when I was reading stories like this about what farming would be like right now.

Farmer Jones stepped to a small black instrument panel at the rear of the air-conditioned plastic "bubble" in which we sat, my wife seated beside me - I had brought her along to write the woman's angle of this interview with a Year 2000 farm family for "Atomic Life." We had just come up a ray-powered elevator from the family's spacious bomb-and-fungus-proofed, solar-conditioned subsurface quarters. We were surveying his fields.

Farmer Jones pressed a button marked "Activator." There was a slight hum and a cylinder rose in the field a few feet beyond the clear plastic wall. A door opened in the cylinder and a robot, closely resembling a 1956 man, stepped jerkily out into the field.

"I must apologize for my hired hand," Farmer Jones said lightly, "Since full parity prices have been removed from our crops, I haven't been able to afford a newer model. But, he has served me well. A couple of new tubes and a paint job will tide him over for another year or two." [More]
Note the mention to parity prices - we really have been conditioned to socialized agriculture for a long time haven't we?

It's not the seed, after all...

At least we can't prove it yet. Those darned economists and worse yet, econometricians are alla time forcing us to believe data and not our own eyes and memories.

It seems there is not enough evidence to convict on the charge of GM seed accelerating the trend line yield increases.
The regression models were re-estimated allowing separate trends before and after 1996. Panel B of Figure 2 shows the results of this analysis, which indicate that the trend in corn yields since 1996 changed by very small magnitudes: +0.2, 0.0, and +0.2 bushels per acre in Illinois, Indiana, and Iowa, respectively. At most, the models estimated that yield trends increased by about two-tenths of a bushel after adjusting for the effects of weather. Furthermore, none of the changes in trend were statistically significant. The sensitivity of the results was examined by also fixing the breakpoint at 1994, 1995, 1997, and 1998. The magnitude of the estimated change in trend yields was not sensitive to the alternative breakpoints[2]. In sum, the regression models did not indicate that a notable increase in trend yields for corn occurred in the mid-1990s.

How can we reconcile the lack of evidence for an increase in corn trend yields with the widespread perception that trend yields accelerated over the last decade? One possibility is that observers failed to recognize the impact of relatively favorable weather since the mid-1990s, and thereby, mistakenly attributed corn yield increases to technology. Figures 3, 4, and 5 show key weather variables for the three states over 1960-2007. The top panel in each figure shows total June-July precipitation and the bottom panel shows average July-August temperatures. The regression model results indicated that these were the most important precipitation and temperature variables for corn production in Illinois, Indiana, and Iowa. [More]
But wait - there are some caveats:
An alternative explanation for the regression results is that a shift to a higher trend in corn yields actually occurred in the last decade but there is not enough new data to detect the change. Two previous technological revolutions caused sharp jumps in trend yields (single cross hybrids in the late 1930s and nitrogen fertilizers in the late 1950s), so a shift would not be without historical precedent. As noted in the introduction, many farmers, crop experts, and seed companies credit biotechnology-driven improvements in seed genetics for recent corn yield increases.

Some experimental evidence provides support for the trend acceleration view. For example, Below et al. (2007) report that triple-stack corn varieties containing the bt-rootworm trait have a large yield advantage over non-bt varieties, as large as 50 bushels per acre. The authors note that yield advantages conferred by the rootworm trait are difficult to attribute entirely to rootworm control and hypothesize that the trait alters the corn plant's efficiency of nitrogen use. It is important to recognize that the experimental results reported by Below et al. are based on only one site (Urbana, Illinois) for one year (2007).
So, maybe it's just too early to have definitive data.

I'm not belittling this research or seed corn company assertions, but however this turns out it illustrates one major factor in competing successfully today: waiting for proof is a good way to get run over.

If triple-stack corn is yielding big yield boosts, those who wait for iron-clad confirmation will be history or at least runner-ups in land competition. If it is not, it certainly doesn't appear to be hurting yields much, so the major downside is only the difference in seed costs.

My hunch is it is hard to fool all the farmers every year, and I have found very few operators who do not subscribe to the GM-boost theory. Moreover, their evidence, however anecdotal often covers good years and bad, and is not masked by state averages.

I'll stick with the advantage of intuitive judgment on this one, even at the risk of being labeled foolish years from now when the definitive effect is teased out from a pile of variables. There is room to believe in the wisdom of crowds in situations like this.

Besides it's important to remember that if a lot of us don't take this approach the economists won't have enough data to prove we're wrong.

[Thanks, Paul]
Order it yesterday...

Help is on the way for hard-pressed farm machinery manufacturers who need public relations cover for what would otherwise be indiscreet displays of pricing power*. Steel prices are set to explode.
The worst-case scenario could be a repeat of 2004, when manufacturers of many products, from automobiles to washing machines, faced severe steel shortages and record-high prices.

That's not happening yet, but there's plenty to worry about, according to some industry experts.

The price of hot-rolled steel, a product frequently used by metal- product companies, has increased about 6 percent in the last two weeks. Currently, some steel suppliers will guarantee price quotes for only a short period of time because they aren't sure what prices will be after only a few weeks.

Nationwide there is less than a three-month supply of some materials, and sources of imported steel have dropped dramatically.

"We see the United States entering another period of really disrupted steel prices and availability," said Bill Gaskin, president of the Precision Metalforming Association, a Cleveland trade group.

"People are seeing significant increases in prices. We have seen some reports of anticipated shortages, or nervousness, coming out of the Twin Cities area," Gaskin added.

Steel is the main raw ingredient for many manufacturers. Increased costs can translate into higher prices for manufacturing companies and, ultimately, consumers.

The price of stainless steel has more than doubled since 2003 and has remained stubbornly high for months. [More]
My sources talk about farm equipment price increases of 9-12% within days by heavy steel users. And the blame can be legitmately handed off to steelmakers, and then to ore producers.

Part of the problem is the increased use of stainless steel - which we all love, judging from the washer and dryer we just bought to put our tax rebate in circulation patriotically. [Have you priced a washer lately? Yikes!!]
"Everyone agrees that prices are moving up gradually. There is positive momentum," Rantanen told Reuters. "We still see very good end-user demand."

Much stainless steel was going into big energy-related projects such as for liquefied natural gas and oil production.

"I don't believe these types of projects will be impacted by the financial crisis," Rantanen said. [More]
Another hint of this emerging issue was the surprising Producer Price Index figure released today.
On Tuesday the government announced the Producer Price Index rose 1.0% in January, while core inflation, stripping out food and energy costs, rose 0.4%. The PPI measures inflation pressures before products reach the consumer.

The results match the core inflation increase in February 2007, and the last time it was higher than that was November 2006. Economists polled by Thomson's IFR Markets had expected overall wholesale inflation to rise just 0.3%, while core inflation was expected to increase 0.2% in the month.

"It was a lot worse than expected," said David Wyss, chief economist at Standard and Poor's, "and it shows the problems the Fed has with fighting inflation while also fighting recession." To keep the economy from slowing too much, the Federal Reserve has been cutting interest rates, but in doing so it risks creating a monetary environment conducive to inflation. [More]

These price pressures and the prospect of likely interest rate decreases are signaling money may be one of the worst ways to hold wealth. For many, this is anathema - cash is synonymous with sound business thinking. But maybe the painful lessons some of us learned in the 70's and 80's about inflation will help us overcome the love of money to protect our true wealth.

* To understand pricing power, see: wheat, spring.
MSM and the farm bill...

One of the last remaining ogres in the closet for extremists has been the Mainstream Media (MSM). Which is why many were delighted with the great kerfluffle over John McCain and the Not Very Unattractive Lobbyist. The much despised NYT was roundly booed from rafters around the nation. And if you can't connect the dots, the NYT constitutes the focal point of the MSM.

So editorial calls to reform the Farm Bill were dismissed by the agents of status quo and most farmers as another attempt by liberal eggheads to interfere in something about which they were essentially clueless.

Well, there is some cluelessness running loose, but it may not be the MSM.
The editorial map also deflates recent claims that criticism of status quo subsidies amount to little more than uninformed complaining by out of touch elites far removed, geographically and intellectually, from the realities of “production agriculture.” Senate Agriculture Committee member Kent Conrad (D-ND) told the Bismarck Tribune “We're also fighting against an East Coast media that simply doesn't understand farming and is encouraging opposition to the farm bill.” Back in August, House Agriculture Committee Chairman Colin Peterson (D-MN) informed Delta Farm Press that “those of us in farm country don’t know about the big city and we aren’t about to tell them what to do. But these big-city editorial writers and others don’t have a clue about agriculture and they should keep out of our business. We’d all be better off.”

As the map makes clear, some of the strongest criticism of agri-business as usual farm subsidies has arisen from the heart of farm country itself, in California, the Midwest, the Mountain West and the South. Nor is it only editorial boards that think an overhaul of agriculture policy is past due. A recent poll commissioned by Oxfam America in several states including Iowa, Colorado, and Minnesota shows that 60 percent of voters believe the Farm Bill needs reform. [More]
What has fascinated me is the wide political spectrum calling for reform. When the SF Chronicle and WSJ all want the farm bill changed fundamentally, this is not a "wing" phenomenon. (Can you have a "middle wing", BTW?)

I have also noticed an attitude of "farmers should write the farm bill" is widespread. This interesting approach would be a hoot if it spread to other legislation. Why not let doctors write the health bills, and generals write the defense bill, and teachers write the education bills?

The same reason applies - because the people who foot the bill get to say what the rules are - not those who get the checks.

One final note to all those who loudly point out out the farm bill loot mostly goes to food stamps, etc. Are you suggesting a we should take those programs out of the farm bill?

I thought not.
Why I'm not posting much about the farm bill...

Two reasons:

1. I don't care very much. I working on 2009-10 proforma budgets and when I can sell '09 beans at $12.90 and corn at nearly $5.00, tell me again why a $24 DCP needs to be my uppermost worry.

Yeah, yeah - the world could come to an end and we'll all be begging for LDP's. I severely discount that possibility and invite those who bet on it to stand ready to be be wrong in the competition for land.

2. We're not just getting mixed signals. We're getting wildly opposing signals.

One view:

Peter Shinn reported yesterday at Brownfield that, “An extension of the 2002 farm law through at least the end of 2009 is looking increasingly inevitable as negotiations on the next farm law drag on toward the March 15th expiry of the current extension of the 2002 measure. That’s the word from Senate Agriculture Committee Chairman Tom Harkin of Iowa, who put the blame squarely upon the Bush administration for the current farm bill stalemate.

“Harkin, in an exclusive interview with Brownfield Sunday evening, noted the Senate passed its version of the farm bill by a veto-proof margin of 79 votes, a tally he said would have totaled 83 except ‘four people were out running for President.’ Harkin added that he could hardly be blamed for not producing a bi-partisan measure.”

Mr. Shinn indicated that, “According to Harkin, the President’s farm bill team has been inflexible on what the farm bill will cost and how it’s to be funded. Brownfield pointed out that new U.S. Ag Secretary Ed Schafer and Deputy U.S. Ag Secretary Chuck Conner have both suggested as recently as Thursday that they might be getting more willing to compromise on both those questions. But Harkin said the conciliatory talk of Schafer and Conner hasn’t matched their actions at the negotiating table.

“‘Oh, I’m always encouraged by it, but every time we sit down nothing ever happens and we’ve been sitting down for the last couple of weeks,’ said Harkin. ‘There’s got to be some movement from the White House and I have not seen that yet.’ [More]
Another view (from that irrepressible media supplier and rock musician Rep. Peterson):
A clearly upbeat – yet cautious – House Ag Committee Chairman Collin Peterson (D-Minn.), in an interview with me Sunday evening, said he was the most optimistic he has been “in one year and two months” regarding reaching funding levels and details for a new farm bill, “and this is the first time I do not feel totally alone,” he added.
But my favorite was this political trash-talk:
Peterson said he wants the farm bill process to continue to be inclusive, including meeting with Bush administration officials. “But if they do not work with us, we will run over them. That will be our message to them – work with us, not against us. We want everyone on board.” [More by subscription]
Jeez - what part of "veto" does he not comprehend? But this has been typical bluster from Peterson. If you want to bet the farm on it, OK. I'm going to assume the President is really going to do what he has said time after time: veto any bill with tax increases and no true reform. (Another reason I will be listening closely to Sec. Shafer at the Commodity Classic on Friday)

And a veto or extension means a slow death for farm policy as we know it, and less political leverage for those who make it their only legislative skill.

Monday, February 25, 2008

I counted 27 cupholders...

A 360-degree view of an Airbus 380 cockpit (flight deck).

(Takes a little time to load, but worth it)
It's growing on me...

I wrote earlier about the new Cargill website. Just an update to say, it has not only gotten better and (I think*) faster, but it now needs less navigation to arrive at my quotes. The site remembers me and zeroes in on my stuff immediately.

[The reason I'm posting this unsolicited testimonial is I just got off the site after I sold some of the last of my '07 corn today and a little '08 corn and beans. I guarantee the market will therefore go up tomorrow]

Oddly, one of their most promising pages is the "Financial" page with stock market info. Still it needs the quotes on their grain bin program, although more information is up now on special programs like "Working Bushels"

I told 'em last time beauty is as beauty does. However, this cutting edge site is delivering more and more of what I need. And according to my Cargill customer rep, the nirvana of complete on-line transaction capability is in sight.

Hmmmm - that leads to the heightened possibility of marketing under the influence. Lord knows, I think I've seen many a blog comment from possibly impaired readers. I'm thinking about one of those breath interlocks on my computer. May be some kinda intelligence test that has to be completed accurately in a given time before you are allowed to book a sale.

I smell a Web 2.0 startup...

* The kids just got home from school, and my server always bogs down about now.

Those skinny Gallic goofballs!...

At least you can't say the French are any ruder to foreigners than to say, their President. And he can hold his own, too.
Footage of French President Nicolas Sarkozy's sharp exchange with a man who refused to shake his hand at an agriculture show collected hundreds of thousands of hits on the Internet on Sunday.

Sarkozy was filmed smiling and shaking hands with visitors as he arrived on Saturday for the opening of the agriculture fair, dubbed the "world's biggest farm" drawing some 600,000 people to celebrate French farming.

As he moved through the crowd, Sarkozy drew near the man, who told him, "Oh no, don't touch me." The president, who kept smiling, responded: "Get lost, then."

"You disgust me," the man said.

"Get lost, you stupid bastard," Sarkozy responded. [More]
I like to watch the video and dub in the words with my own unique French accent.

I say we invite him to the Farm Progress Show and schedule a special TV report (after family viewing hours, of course).

Still, if it takes rudeness to establish enough discipline to control overeating, it may be worth it. The French obviously know something we don't about when to say when at the table.
Because they use internal cues -- such as no longer feeling hungry -- to stop eating, reports a new Cornell study. Americans, on the other hand, tend to use external cues -- such as whether their plate is clean, they have run out of their beverage or the TV show they're watching is over.

"Furthermore, we have found that the heavier a person is -- French or American -- the more they rely on external cues to tell them to stop eating and the less they rely on whether they felt full," said senior author Brian Wansink, the John S. Dyson Professor of Marketing and director of the Cornell Food and Brand Lab in the Department of Applied Economics and Management, now on leave to serve as executive director of the U.S. Department of Agriculture's Center for Nutrition Policy and Promotion until January 2009.

The new study, an analysis of questionnaires from 133 Parisians and 145 Chicagoans about how they decide when to stop eating, is being published in the journal Obesity and is being presented this later month at an the Winter Marketing Educators conference.

"Over-relying on external cues to stop eating a meal may prove useful in offering a partial explanation of why body mass index [a calculation based on the relationship of weight to height] varies across people and potentially across cultures," said co-author Collin Payne, a Cornell postdoctoral researcher. He stressed that further studies should following up with smoking behavior and socio-economic differences as well. "Relying on internal cues for meal cessation, rather than on external cues, may improve eating patterns in the long term. [More]
Does this prove in reverse the "fat and jolly" stereotype has some basis? Or is it more subtle that that. Think about it. If you wanted to do food consumption research, France would be your first choice on your grant application, wouldn't it?

Lighten up and lessen the resentment...

Biotech manufacturers have been relentless in their aggressive promotion of the controversial technology. And arguably, it may have been necessary to be in every face every moment to defend this nascent industry. However, without doubt, whether because of this strident clamor or despite it, it is now clear that biotech is well and truly established and flourishing.
FOR a decade Europe has rebuffed efforts by
biotechnology firms such as America's Monsanto to promote genetically modified crops. Despite scientific assurances that genetically modified organisms (GMOs) are safe for human consumption, and a ruling by the World Trade Organisation against national import bans in the European Union, many Europeans have yet to touch or taste them. But that may soon change, according to Iain Ferguson, boss of Tate & Lyle, a British food giant. “We sit at a moment of history when GM a fact of life,” he said this week.

Mr Ferguson, who is also the head of Britain's Food and Drink Federation, argues that because many large agricultural exporters have adopted GMOs, it is becoming expensive to avoid them. Copa-Cogeca, a farmers' lobby, this week warned that the rising cost of feed could wipe out Europe's livestock industry unless bans on GMOs are lifted. Meanwhile, European agriculture ministers failed to agree on whether to allow imports of GM maize and potatoes; the decision will now be made by the European Commission, which is likely to say yes. [More]
But is hard sell the optimal public relations strategy as the tide of acceptance turns?

I would suggest (doubtless much to the horror of PR firms who feed on billable hours) that a less-intense approach could accomplish more than a continued self-promotion that amounts to little more than end-zone dancing. Finding a way for the last holdouts to change their minds as gracefully as possible by simpling toning down the ad campaign and pausing to listen thoughtfully could be the best money Monsanto, et. al. never spent.

As the Clinton campaign is desperately trying to figure out - judging by the combination of messages in the last three days - attacking a gracious winner is really hard to do successfully. Biotech is a winner and every day that passes reinforces the industry's claim to safety and widespread benefit to consumers and producers alike. Time works in our favor. I like to quietly ask especially outspoken opponents if they have seen even one of the horrifying outcomes predicted for RR beans for example. And we are well into a second decade of real world data.

Why not take the "Cal Ripken" approach: modesty? And then use the dead air time to listen to customers and neighbors for clues to where we could find our next winning strategy.
It's worth considering...

Corn farmers are on the path to a confrontation with the livestock industry. After a remarkably laid-back indifference to legislative action that put the government in direct competition for their feed supply, meat, dairy and egg producers are pushing back.
Last year began with seemingly every Midwest rural community announcing a corn-based ethanol plant. By fall, the bottom fell out of the ethanol and biodiesel expansion. It went from one extreme to the other.

Communities both loved and feared these projects, creating tax incentives, filing lawsuits against projects, or both. Public opposition transitioned from thermodynamic inefficiency to insufficient water supplies and then settled on the food vs. fuel debate. Grain farmers cheered the $4/bushel price of corn. The livestock industry became antibiofuels.

The year ended with apprehension about the future of biofuels, but this is not the end of the story. Economic growth is measured in decades - not in weeks or months. We are just getting started. [More]
None of this would matter as much if the corn market, and ethanol in particular were less subsidized. But if subsidies were ended wouldn't the wonderful word of $5 corn vanish in a puff of smoke?

It turns out, the answer is an unequivocal: it depends.
Tyner analyzed four policy options - the current 51-cent fixed subsidy, the variable subsidy, no subsidy and a renewable fuel standard - at oil prices ranging from $40 per barrel to $120 per barrel. The renewable fuel standard contained in the 2007 Energy Act mandates that energy companies purchase 35 billion gallons of ethanol by 2022, with a maximum of 15 billion gallons coming from corn.

"Regardless of the policy, results become similar at high crude oil prices where the market dominates," Tyner said. "At low oil prices, however, government policies have huge effects, and all the results are enormously different. The policy choices we make will be critical."

With oil at $40 per barrel, for example, ethanol production is not profitable without a subsidy or higher fuel costs. With a fixed or variable subsidy in effect at this oil price, the government spends $5 billion per year to subsidize ethanol production, Tyner said. Ethanol is considerably more expensive than fuel made from petroleum in this scenario, but with the renewable fuel standard in effect, fuel companies are required to buy 15 billion gallons of corn ethanol per year. At $40 crude, the standard would cost consumers an extra $12 billion per year at the pump, Tyner said.

Subsidies are paid out of taxpayer dollars by the federal government, while the renewable fuel standard costs consumers at the pump, Tyner said.

Therefore, the standard does imply costs at low oil prices, when buying ethanol would otherwise be uneconomical. His model calculates the hidden cost of the standard, which tacks on an extra $1.05 per gallon when oil is $40. In such a situation, in other words, ethanol costs $1.05 more per gallon to produce from corn grain than gasoline costs to produce from crude oil, and the consumer indirectly makes up the difference, he said.

If oil surpasses $100 per barrel, however, the renewable fuel standard costs consumers little or nothing extra. That's because at this price, ethanol production costs are very close to gasoline production costs, he said. [More of a complex, but intriguing summary of this study]
I would suggest to corn farmers obsessed with trying to forecast when the good times will end a better approach than divination would be to protect ethanol from as many political shocks as possible. With oil moving above $100, the dollar sinking, and feed customers looking for ammunition, letting go first of the blender credit and then the tariff (remember it won't hurt much as the dollar shrinks compared to the real) could be cheap insurance against a rude political awakening.

But we likely won't. Only a concerted action by political power as great as ours will induce us to consider a free market solution.

Which is why I'm not betting on any change soon. Guys like me have no traction whatsoever compared to those who would rig the market at our best customers' expense and espouse civic virtue in the same breath.

Sunday, February 24, 2008

Of course, the poles could be cornstalks...

How morning glories grow.

Shot 1 every 10 minutes.

[via Neatorama]
Know where your food comes from (Part VII)...

One of the complaints frequently leveled at industrial agriculture is it obscures the origin of our food.

Maybe not.
The tainted lettuce that sickened 80 people in the Midwest in 2006 came from a Kern County farm located next to two dairies, state and federal authorities have found.

The lettuce, which was contaminated with E. coli bacteria, was grown at Wegis Ranch in Buttonwillow, according to a joint report by the U.S. Federal Drug Administration and the California Department of Public Health. The report was released Feb. 15.

The victims had all eaten at one of two Taco John's restaurants in Iowa and Minnesota in November and December 2006. Bacteria were found in the lettuce, and authorities were able to trace the produce to California.

From there, investigators focused on two possible locations of the contamination, and lab tests showed the exact strain of E. coli found in the lettuce matched samples found at Wegis Ranch as well as the nearby dairies. [More]
Technology is going to make sure that we know where everything comes from. It will be interesting to see how local all local food actually is when that occurs.

You can run, but you can't hide [in the produce section, anyway].
Experiencing inflation...

Similar to an economic "wind-chill" calculation the effect of inflation may not be simply encompassed in a set of CPI numbers. Inflation is experienced personally and emotionally. This has importance for the food industry for reasons you will see below.
I don't know much psychology, but I do know that people carry grudges. We are all much more likely to remember slights than compliments. And when it comes to price changes, we have very selective memories, too. Ask nearly anyone about inflation and they are likely recall price increases. Recently, the list will include food and gasoline. They somehow take them as personal affronts. Probe further, and people might admit that the price of clothes has fallen, or that their phone service is cheaper; but that's not what they remember first. Looking at the Consumer Price Index (CPI) data for January 2008 through this lens of consumer psychology suggests brewing trouble.*

This morning the Bureau of Labor Statistics reported that the all-items CPI rose 4.8 percent at an annual rate (a.r.) for the month. Lower than last November's level of 10 percent, but still high. And core measures are up, too. The traditional core CPI that excludes food and energy rose 3.8 percent (a.r.) for the month, while the Median CPI computed by the Federal Reserve Bank of Cleveland increased at a rate of 4.2 percent. All of these monthly readings are well above their 12-month averages of between 2.5 percent (for the traditional core) and 4.3 percent (for the headline measure).

The detail in this month's report confirms some of last falls more ominous suggestion that inflation is rising across the board. In an average month last year, over 20 percent of prices in the CPI fell and slightly more than 60 percent rose by more than 2 percent. This month, you have to look with a microscope to find falling prices. At the level of detail normally reported, prices fell in only five categories, accounting for 14.5 percent of the index. Meanwhile more than three-quarters of prices rose by more than 2 percent. If people tell you that inflation is a problem, it is a not result of selective memory. They are just accurately reporting their experience with rising inflation. [More]
Adding to the problem is the uncomfortable thought of a flashback to the '70's. While the memories of the clothes, hair and the music are unpleasant enough, don't forget stagflation.
But in putting its emphasis above all on reviving growth, America’s central bank, according to some economists and even a few Fed officials, may face a bigger inflation problem down the road.

“They are cutting rates with a bill to be paid later," said John Ryding, chief United States economist at Bear Stearns. “The question is not, will we get inflation, but how much will it cost to stuff the genie back in the bottle. This has the feel of 1970s stagflation.”

Over the last 12 months, consumer prices are up 4.3 percent on average, according to the Labor Department. The core index of consumer price inflation, which excludes food and oil, was 2.5 percent higher in January than a year earlier, significantly above the Fed’s unofficial comfort zone of a 1 to 2 percent underlying inflation rate. That’s a far cry from the double-digit inflation rates that battered the economy at times in the 1970s, but still worrisome.

Analysts like Mr. Ryding say that by tolerating such price rises and maybe even allowing them to escalate, the Federal Reserve is risking its hard-won credibility as an inflation fighter, which will ultimately require it to push up interest rates higher than otherwise to contain the damage. [More]
I don't believe history repeats itself. I believe historians repeat each other. So the inevitable comparisons to the 1970's may just be starting.

Just don't get the photos album or the disco ball out.
You think my snappy headlines are easy?...

Then vote for the worst book title of the year. The contenders:
  • I Was Tortured By the Pygmy Love Queen
  • How to Write a How to Write Book
  • Are Women Human? And Other International Dialogues
  • Cheese Problems Solved
  • If You Want Closure in Your Relationship, Start With Your Legs
  • People who Mattered in Southend and Beyond: From King Canute to Dr Feelgood
[More with helpful book summaries]

[via Arbroath]
The international pork industry...

Is in much worse shape than I ever thought.

Saturday, February 23, 2008

Where your food comes from...

It is my conviction that farmers as a whole are just as clueless as most consumsers about "where food comes from" and more to the point, how it gets to your table. As more consumers begin asking questions and calculating environmental costs, I think it behooves us in the industry to have something other than platitudes to respond with.

So, a few facts about orange juice and energy.
In the end, not-from-concentrate orange juice sold by the carton comes out slightly ahead of frozen OJ sold by the canister in terms of energy use. As a green consumer, your worst choice would be to buy juice that's been rehydrated by the supplier, then placed in cartons (such as Minute Maid Original). If you prefer juice from concentrate, whether for the lower price or more Tang-y taste, it's better to rehydrate it yourself.

What about squeezing your own OJ? Keep in mind that, unless you live in Florida or California (the nation's No. 2 orange producer), chances are those Valencias traveled a long, long way to get to your grocery aisle. And transporting enough oranges to yield six servings of juice requires nine times more cardboard waste than transporting a 12-ounce canister of FCOJ. [More of a short but succinct explanation of the OJ biz]
In the world of energy, there is no substitute for doing the painful math required to overcome the bias of our eyes and instincts. The problem is we only embrace this rational approach when the answer is something we like.
The prediction problem (Episode 24)...

Grain markets have made fools of about 173% of all market advisers lately. Which has froozen many of us in our tracks and lowered our confidence in almost nay prediction. Is the future actually more unknowable than it used to be? How should we try to prepare for tomorrow?
We all want to know what comes next. It would be great to know in advance if buying that stock, taking that job, or marrying that person is the right idea. But we can't. As Salman Rushdie wrote during his years on the run from the fatwa, "Our lives tell us who we are." We can't know for sure how things will turn out until they happen.

But we can surmise the context in which the future will occur. We can aggregate early signals and make smart decisions based on them. Rather than calling outcomes, we're here to call trends, to cut through conflicting signals and discern the most powerful ones. We don't know which company will become the leader in multitouch devices, for example, but we've seen plenty of signals to support a contention that multitouch will be huge in the years to come. That's why I'm so excited about two just-around-the-corner events, TED and our own ETech: They give you a peek into the future, straight from some of the places where it's happening already. [More]
Even this modest goal (identifying trends) is harder to do than say. But I think opportunity abounds now for those who are willing to make the effort, since so many of us have stopped trying.
Rendering unto Caesar...

Worked on my final draft of my income tax novel - and a free-thinking piece of work it is too. Some of my finest and most imaginative creativity is contained in those little boxes and blanks. Of course, TurboTax (which is much less robust for Macs) has taken much of the innovation out of my figuring, but still I like to think the boys in Kansas City will recognize the work of a gifted storyteller when they read it.

One perhaps helpful hint for this year: income averaging.
Why our annual Farm Journal planning meetings...

Are so painful for this engineer: we talk about design, and graphics, and style.

But apparently that kind of stuff can make or break a magazine since this book you DO judge by the cover. And when our own Dairy Today made a big splash with their cover, it reinforced the point.
A magazine is that rare publication in which you're actually expected to judge a book by its cover. This explains why a good magazine cover — like a good book jacket or, say, a poster — benefits enormously from a great, central, visual idea, which is one reason why portraits are so ideally suited to covers. This is perhaps particularly true of fashion and lifestyle magazines — things like Vanity Fair and Vogue — publications that typically enlist a celebrity's likeness to help sell magazines. With such an unbeaten formula for success, clearly the barnyard is the next logical step. Or is it? Unlike their consumer counterparts, trade magazines aren't obliged to sell themselves in quite the same full-frontal manner. They're not competing for the same kind of attention in a dense visual marketplace. Their circulation is mail-driven — not newsstand-driven — but does this mean they don't deserve the same attention to scale, drama, impact? D.J. Stout's recent redesign for Dairy Today reminds us that a good magazine cover depends less on a magazine's circulation and content, and perhaps more on the art director's imagination and skill. But you're nothing without a star. Some years ago, I wrote an essay on the uncredited art directors of trade magazines, in which I went to great lengths to learn more about — of all things — poultry farming. When I saw the new and improved "Dairy" I wondered: beyond the white background and the big nameplate and that exquisite bovine mug, what was so different from those magazines of long ago? [More for you art history majors]

My observation is putting a cute chick on the cover is never a bad idea.

[via 2 blowhards]

Friday, February 22, 2008

How agrarian ag might work...

If you read my book review from last night, you might find this counterpoint interesting. By linking two seemingly unrelated events - $100 oil and Castro stepping down - one can construct a scenario that would make a return to agrarian farming a dominant part of our industry.
19 February 2008 was an historic day. For the first time in history, the price of oil at the close of the U.S. markets sat above $100. Ok, it was by only a penny, but that penny was probably the most significant penny anyone's see in years. And when you consider that in 2006 the U.S. consumed just over 20 million barrels of oil everyday, those pennies start to add up pretty quickly. The other major news event of the day was of course the announcement by Fidel Castro that he will step down from his top position in Cuba after nearly 50 years. The announcement received wide attention, but after years of frail health the news was not as surprising as it would have been not so long ago. Two events, forecasted for years, finally came to fruition. At first blush, the two seem utterly distinct, totally separate and unrelated events. It is true there is no causal relationship (unless someone knows something I don't), but there is a more subtle, deeper connection between the two.

For years I've listened to scientists and economists, one after another, pronounce that nothing can, nothing will be done to move our society past its addition to oil until said oil reached $100 a barrel. Well, that day has arrived. I'm just wondering what it will mean? Should I start preparing my landlady's roof for solar panels? Can I expect a new, faster, more efficient mass transit system to shuttle me around Philadelphia, to my family back in Latrobe, or to meetings and conferences around the country? Does this mean we Americans will have to finally face the fact that our current consumption habits are simply unsustainable, and that these higher costs will finally force us to reconsider our lifestyles? Is the new post-petroleum age upon us? [More]
Analyzing what happened to Cuban food production after the fall of the Soviet Union provides at least some insights into conditions that might force a rethinking of our industrial ag sector.
The American model of agriculture is pretty much what people mean when they talk about the Green Revolution: high-yielding crop varieties, planted in large monocultures, bathed in the nurturing flow of petrochemicals, often supported by government subsidy, designed to offer low-priced food in sufficient quantity to feed billions. Despite its friendly moniker, many environmentalists and development activists around the planet have grown to despair about everything the Green Revolution stands for. Like Pretty, they propose a lowercase greener counterrevolution: endlessly diverse, employing the insights of ecology instead of the brute force of chemistry, designed to feed people but also keep them on the land. And they have some allies even in the rich countries—that's who fills the stalls at the farmers' markets blooming across North America.

But those farmers' markets are still a minuscule leaf on the giant stalk of corporate agribusiness, and it's not clear that, for all the paeans to the savor of a local tomato, they'll ever amount to much more. Such efforts are easily co-opted—when organic produce started to take off, for instance, industrial growers soon took over much of the business, planting endless monoculture rows of organic lettuce that in every respect, save the lack of pesticides, mirrored all the flaws of conventional agriculture. (By some calculations, the average bite of organic food at your supermarket has traveled even farther than the 1,500-mile journey taken by the average bite of conventional produce.) That is to say, in a world where we're eager for the lowest possible price, it's extremely difficult to do anything unconventional on a scale large enough to matter.

And it might be just as hard in Cuba were Cuba free. I mean, would Salcines be able to pay sixty-four people to man his farm or would he have to replace most of them with chemicals? If he didn't, would his customers pay higher prices for his produce or would they prefer lower-cost lettuce arriving from California's Imperial Valley? Would he be able to hold on to his land or would there be some more profitable use for it? For that matter, would many people want to work on his farm if they had a real range of options? In a free political system, would the power of, say, pesticide suppliers endanger the government subsidy for producing predatory insects in local labs? Would Cuba not, in a matter of several growing seasons, look a lot like the rest of the world? Does an organopónico depend on a fixed ballot?

There's clearly something inherently destructive about an authoritarian society—it's soul-destroying, if nothing else. Although many of the Cubans I met were in some sense proud of having stood up to the Yanquis for four decades, Cuba was not an overwhelmingly happy place. Weary, I'd say. Waiting for a more normal place in the world. And poor, much too poor. Is it also possible, though, that there's something inherently destructive about a globalized free-market society—that the eternal race for efficiency, when raised to a planetary scale, damages the environment, and perhaps the community, and perhaps even the taste of a carrot? Is it possible that markets, at least for food, may work better when they're smaller and more isolated? The next few decades may be about answering that question. It's already been engaged in Europe, where people are really debating subsidies for small farmers, and whether or not they want the next, genetically modified, stage of the Green Revolution, and how much it's worth paying for Slow Food. It's been engaged in parts of the Third World, where in India peasants threw out the country's most aggressive free-marketeers in the last election, sensing that the shape of their lives was under assault. Not everyone is happy with the set of possibilities that the multinational corporate world provides. People are beginning to feel around for other choices. The world isn't going to look like Cuba—Cuba won't look like Cuba once Cubans have some say in the matter. But it may not necessarily look like Nebraska either. [More of an excellent article about Cuban agriculture]
Could such a combination of factors arise here? It is less unthinkable that it used to be. But the absolute drop-off in oil experienced by Cubans is unlikely to occur in the US. But even if it is more gradual, the agrarian portion of US ag could become the hot growing portion, capturing more and more market share.

Another reason to be glad I'm getting older - those types of changes are not that easy. And I think we'll need some younger minds and bodies to make such a shift.
Credit crunch update...

Just a quick story that I think points out one emerging headache that was not well thought out on the downside by lenders eager to securitize mortgages.
Judges in at least five states have stopped foreclosure proceedings because the banks that pool mortgages into securities and the companies that collect monthly payments haven't been able to prove they own the mortgages. The confusion is another headache for U.S. Treasury Secretary Henry Paulson as he revises rules for packaging mortgages into securities.

``I think it's going to become pretty hairy,'' said Josh Rosner, managing director at the New York-based investment research firm Graham Fisher & Co. ``Regulators appear to have ignored this, given the size and scope of the problem.''

More than $2.1 trillion, or 19 percent, of outstanding mortgages have been bundled into securities by private banks, according to Inside Mortgage Finance, a Bethesda, Maryland-based industry newsletter. Those loans may be sold several times before they land in a security. Mortgage servicers, who collect monthly payments and distribute them to securities investors, can buy and sell the home loans many times. [More]
The fallout from this could likely affect the depth of the stack of paper you'll sign for your next loan. I've already gone from 3 to 8 pages for my operating loan. Who knows where we could be heading?
Friday Deep Thoughts...

I taken decades of flack because of my SF viewing habits. But if you want to understand something about leadership, study these Seven Habits of Highly Effective Spaceship Captains:
1. The Prime Directive is just a suggestion. Captain Jean-Luc Picard of the Enterprise wasn't as swashbuckling as he predecessor Captain James T. Kirk, simply because he actually wrestled with breaking the Prime Directive instead of ignoring it entirely. The Prime Directive states that humans shouldn't involve themselves in the affairs of less developed planets, for fear of messing up their cultures with ultra-advanced tech. While Picard often considers the importance of the Prime Directive in his decision-making, he refuses to be bound by it. Lesson learned? Rules are made to be broken. [More stellar advice]
Live long and prosper.

Thursday, February 21, 2008

Local food, global miscalculations...

[I know, I know - I said I would get this book review up about twenty times before and it was due a month ago. This whole deal is turning into fourth grade all over again. Just be glad I'm not just paraphrasing the book jacket. Which I didn't do then either.]

Animal, Vegetable, Miracle - A Year of Food Life by Barbara Kingsolver

There is a tide in the food culture and writers like Kingsolver and Michael Pollan surf it better than almost anyone. Whether its the loss of connection predicted by Putnam due to the passing of the WWII generation, or general dissatisfaction with modern lifestyles, many of us with ample disposable incomes have decided the problem is our food.

I mention Pollan, because at time AVM reads like his latest report from the frontlines of getting in touch with our calories - Omnivore's Dilemma. To unfairly summarize, our food supply, in their opinions, has been hijacked by poor nutrition choices and the profit motive.

Given the considerable talents of both, their powers of persuasion are not to be dismissed lightly. And the criticisms of our food system are for the most part on target: we eat too much of the wrong food, we eat too much prepared foods and miss the power of food preparation as a human activity, we have lost any linkages with where food comes from.

Perversely, that last complaint often spouts from self-appointed ag-spokespersons. Only they are referring to veneration of farmers and public dollars for subsidies, whereas modern food writers like Kingsolver are correctly labeling the unfortunate lack of understanding of how much better our eating and living could be if we respected the processes of nature and traditions of cultures in food preparation and enjoyment.

Kingsolver's premise was to eat local for a year, growing and consuming as much as possible from her own garden and neighborhood. Her account is masterfully told, albeit interrupted by poorly informed little sermons from her college daughter. Like Pollan, Kinglsover brings enormous literary talent to bear on her arguments against CAFO's, HFCS, vegetables from California in January, and the now-familiar litany of foodie-complaints.

She also includes some highly dubious or flat out false statistics: "fewer than a third of our farms are run by families"; "An estimated 67 million birds die each year from pesticide exposure on US farms." [Some context - that would work out to about 1/5 bird per acre of cropland. US bird population best guess I could find = 5000 million (5B) birds. If pesticide loss is true, which is very unlikely, it would be a little over 1% loss]"

Any verbiage about GM crops is long since disproven (butterflies and GM pollen) or simply mistaken.

Surprisingly, I agree with many of her points about food itself. Thanks to a master gardener roommate, I have discovered that maybe I do like fresh, in-season vegetables after all. I throw out the tomato-like impostors that add neither taste nor texture to winter salads and wait to eat in season. And I consume far less meat, and prefer poultry dark meat as the only part of modern birds with any hint of flavor or juiciness in them.

All these choices however, are made possible because of my relatively considerable disposable income, ample room for gardens, and (I think I should have mentioned this first) a spouse who loves to cook and garden, and who doesn't have to commute and hold down a job so we can have health insurance. In short, better food choices are easier to make if you're well-to-do.

Kingsolver dances neatly around this unmentionable truth. In fact, she works studiously to avoid offering any advice as to how others who don't have a husband with tenure and time, and an author's schedule could duplicate her year of food improvement.

Since she is living in a small rural community, understanding of farm life flows into her by osmosis and via the agrarian gurus at the Temple (AKA the farmer's market). She is where things grow, ergo she understands growing things. And this is where her masterful prose goes to strange places.

For example, in her long-winded but poetic lamentation for the loss of tiny, picturesque farms she bizarrely rambles toward embracing the virtues of tobacco, since it was that high value crop that made 20 acres enough to support a family.
""Yes, I do know people who've died wishing they'd never seen a cigarette. Yes, it's a plant that causes cancer after a long line of people (postfarmer) have specifically altered and abused it. [Is she saying we should have stuck with peace pipes and all would have been well?] And yes, it takes chemicals to keep blue mold off the crop. But it sends people to college. It makes house payments, buys shoes, and pays doctor bills."
Kingsolver is so intensely focused on personal enjoyment and meaning in food and the well-lived, self-absorbed agrarian life she cannot fathom the consequences of her conclusions on a globe that includes a few more people than her family.

I also came to realize Kingsolver was sadly and embarrassingly innumerate. She cannot handle this simplest math problem and hence wisely and completely ignores the economic implications of her conclusions about what our food should be and how we should grow and consume it. I think it was this sentence that tipped me off:
"In 2005, ten years after the program began, participating family farms collectively sold $236,000 worth of organic vegetables to regional retailers and supermarkets, which those markets, in turn, sold to consumers for nearly $0.3 million."
Umm, would that be the same as "nearly $300,000", I wonder? Or a markup of about 25% from wholesale. But then $0.3 million sounds so much bigger. Say it out loud and see.

Another example is this extraordinarily ill-informed tax commentary concerning shipping food from places like California.
"It's hard to believe, given the amount of truck fuel involved, but transportation is tax-deductible for the corporations, so we taxpayers paid for that shipping."
Let's go through that little gem of illogic slowly. Tax-deductible does not equal government funded. When I can get a tax credit equal to my fuel bill, then taxpayers will be paying for the shipping. And oddly enough, transportation expenses are allowable tax-deductible expenses for individuals, not just corporations. For instance, authors can deduct plane fares to go on a book tours - just to pick an example at random.

Besides, as the Kiwis demonstrated convincingly, the food miles concept is arithmetically suspect because of the staggering efficiencies of bulk shipping and handling.

But the real killer problem for the local food movement is not the concept that it is better food. In many ways they are dead right. It is that local food is not scalable. In other words, when Kingsolver writes that 70% of Americans live within striking distance of a farmer's market, she leaves the impression that the 210 million individuals could a) all go to one easily and b) find something there to buy.

I stand by my previous conclusion after doing the math: "If we all shopped at farmer markets, where would we park?"

Kingsolver, Pollan, et al. think they understand history and find traditional agrarian methodology vastly superior to industrial agriculture. But no actual numbers demonstrate how our modern food system could be much different if we are serious about getting food to 300,000,000 souls every day. The fact that virtuous agrarian agriculture is a small part of the food industry is blamed on base motives, corporate greed, and sadly misled simpleton consumers. I believe it's because agrarian production is a niche activity that can't begin to carry that kind of load.

Take a business course, people! Then come up with a production, distribution, and retail system that does what ours does at the same cost and I'll bet it looks pretty similar.

But I digress. Kingsolver does scrupulously document the time and costs of her year-long experiment and the wonderful benefits it clearly bestowed on her family. She simply cannot make a credible case for how that example could be adapted to families without access to land in a temperate climate, transportation, or comfortable, secure income.

Local food is a wonderful idea to improve your eating and our world. The idea and people like Kingsolver are going to have a significant effect on industrial food production. But, it is also a luxury good.