ERS Charts of Note
Monday, September 10, 2018
In high-income countries—such as the United States, Australia, and France—investment in agricultural research and development (R&D) has been a key factor in producing the new technologies that have raised output and reduced input use in agriculture. Recent ERS research found that public sectors in high-income countries accounted for a significant but declining share of total global spending on agricultural R&D. As recently as 1990, public-sector R&D spending by high-income countries accounted for about 36 percent of total public and private spending on food and agricultural research worldwide. That share had fallen to less than 25 percent by 2011. Although public agricultural R&D spending by high-income countries rose in 1990-2011, it rose much faster in developing countries. Total private R&D spending also rose much faster than public agricultural R&D spending in high-income countries during this time period. After adjusting for inflation, aggregate public agricultural R&D spending by high-income countries peaked in 2009, and subsequently declined. This chart appears in the ERS report Agricultural Research Investment and Policy Reform in High-Income Countries, released May 2018.
Monday, August 6, 2018
In high-income countries—such as the United States, Australia, and France—increases in productivity typically account for nearly all growth in agricultural outputs. Productivity growth may also reduce the amounts of land, labor, capital, or other inputs used in farm production. Between 1961 and 2014, aggregate agricultural outputs in high-income countries increased by 98 percent (nearly doubling), while total inputs declined by 14 percent. Total inputs grew slowly until the late 1970s and have declined ever since. The mix of inputs also changed, with capital and material inputs substituting for labor and land. Overall, the growth in agricultural outputs and the decline in inputs implies that total factor productivity—the total productivity of the land, labor, capital, and material inputs employed in production—more than doubled over this 54-year period. Investment in agricultural research was a key factor in producing the new technologies that have raised productivity. This chart appears in the ERS report Agricultural Research Investment and Policy Reform in High-Income Countries, released May 2018.
Wednesday, May 30, 2018
On May 30, 2018, the Chart of Note article “Public spending on agricultural R&D by high-income countries grew after 1960, but is now in decline” was reposted to correct an error in the third sentence, which cited the spending peak as $18.7 billion instead of $18.6 billion.
For high-income countries as a group, public agricultural research expenditures (adjusted for inflation) grew rapidly after 1960. However, growth slowed markedly in recent decades and has now turned negative. In constant 2011 dollars, public agricultural R&D spending in these countries grew from $3.9 billion in 1960 to a peak of $18.6 billion in 2009, before declining to $17.5 billion by 2013 (the latest year with complete data). This decline in public R&D spending marked the first sustained fall in agricultural R&D investment by these countries in 50 years, and was most pronounced in the United States and Southern Europe. The United States continues to lead among high-income countries in public agricultural R&D spending, but the U.S. share of the total declined from 35 percent in 1960 to less than 25 percent by 2013. This chart appears in the ERS report Agricultural Research Investment and Policy Reform in High-Income Countries, released May 2018.
Monday, April 9, 2018
Between 1948 and 2015, total farm output nearly tripled, while farm inputs grew little. However, input composition has shifted considerably toward more use of farm machinery (part of capital inputs) and intermediate goods, such as seed, feed, energy use, fertilizer, pesticides, and purchased services. Inputs of intermediate goods and capital inputs (excluding land) grew by 134 percent and 78 percent, respectively. By comparison, labor inputs declined by 75 percent and land inputs fell by 24 percent. Many factors contributed to these input changes. For example, competing uses for labor and land from other sectors or purposes have raised the costs of those inputs. Technological advancements have also made inputs like machinery and agricultural chemicals more effective and affordable for farmers. This chart appears in the March 2018 Amber Waves data feature, "Agricultural Productivity Growth in the United States: 1948-2015."
Tuesday, March 6, 2018
Productivity growth in the U.S. farm sector has implications for both U.S. and global food markets. The United States is one of the largest consumers and producers in world agricultural commodity markets. Slowing productivity growth that fails to keep pace with increasing food demand may lead to rising food prices. It may also put pressure on low-income households, as these households spend a greater share of their income on food. Transitory events—such as energy shocks or supply shortages due to bad weather—may cause agricultural commodity prices to rise, the long-term growth trend in U.S. agricultural productivity has enhanced food security and benefited consumers by reducing the real (inflation-adjusted) price of agricultural outputs over time. Between 1948 and 2015, total factor productivity increased by 152 percent, while real agricultural output price declined by nearly 65 percent. This chart appears in the March 2018 Amber Waves data feature, "Agricultural Productivity Growth in the United States: 1948-2015."
Monday, January 8, 2018
Intellectual property rights are intended to offer incentives for innovation by protecting new inventions from imitation and competition. When the modern U.S. Patent and Trademark Office was established in 1836, new plant varieties were considered products of nature and, therefore, not eligible for protection under any form of intellectual property. In 1930, asexually reproducing plants were the first to receive protection through plant patents, which have been issued primarily for fruits, tree nuts, and horticultural species. The remainder of the plant kingdom, including a broad range of commercial crops, became eligible for protection in 1970 with the introduction of plant variety protection certificates (PVPCs). However, PVPCs had exemptions for farmers to save seeds and for research uses. Full patent protection (without these exemptions) arrived in 1980 with the U.S. Supreme Court decision Diamond v. Chakrabarty. This ruling extended utility patent protection—the type of protection provided to most inventions in other areas—to plants. Despite being available for the least amount of time, annual utility patent grants for plant cultivars and lines have rapidly overtaken PVPCs and reached similar levels as plant patents. The rapid rise of utility patents mirrored the rapid rise in private research and development in the seed and agricultural biotech sector over a similar period. This chart updates data found in the ERS report Agricultural Resources and Environmental Indicators, 2006 Edition.
Tuesday, November 14, 2017
Technological developments in agriculture have been influential in driving changes in the farm sector. Innovations in animal and crop genetics, chemicals, equipment, and farm organization have enabled continuing output growth while using less inputs. As a result, even as the amount of land and labor used in farming declined, total agricultural output more than doubled between 1948 and 2015. During this period, agricultural output grew at an average annual rate of 1.48 percent, compared to 0.1 percent for total farm inputs (including land, labor, machinery, and intermediate goods). The major source of output growth is the increase in agricultural productivity, as measured by total factor productivity (TFP)—the difference between the growth of aggregate output and growth of aggregate inputs. Between 1948 and 2015, TFP grew at an average annual rate of 1.38 percent, accounting for more than 90 percent of output growth over that period. This chart appears in the ERS data product Agricultural Productivity in the U.S., updated October 2017.
Tuesday, September 19, 2017
With less labor and land being used in production over time, U.S. agriculture depends on raising the productivity of these resources for growth. Average national corn yield (a productivity measure) rose from around 30 bushels per acre in the 1930s (where it stood since USDA began measuring them in the 1860s) to nearly 180 bushels per acre in the present decade. This sustained growth in productivity was driven by the development and rapid adoption of a series of successive biological, chemical, and mechanical innovations. Every few years farmers adopt the latest hybrid seed variety, for example. These seeds are likely to have multiple genetically modified (GM) traits designed to protect the crop against pests and diseases or infer other valuable qualities—such as resistance to the corn borer, a major insect pest of the crop. Recently, the rapid adoption of tractor guidance systems has greatly improved the speed and efficiency of tillage and planting operations and the precision of seed, fertilizer, and pesticide applications. By 2010, such systems were used on 45 percent of corn planted acres. This chart updates data found in the ERS report, The Seed Industry in U.S. Agriculture: An Exploration of Data and Information on Crop Seed Markets, Regulation, Industry Structure, and Research and Development, released February 2004.
Wednesday, September 13, 2017
U.S. public sector funding for agricultural R&D is falling, both in absolute terms and relative to major countries and regions. Between 1990 and 2013, the U.S. share of spending among nations with major public agricultural R&D investments fell from about 23 to 13 percent. This decline was driven by a combination of falling U.S. spending (lately mirrored in Western Europe) and rapidly rising spending in developing countries such as India and, especially, China. Chinese government spending on agricultural R&D rose nearly eightfold in real (inflation-adjusted) terms between 1990 and 2013, surpassing U.S. spending in 2008 and more than doubling it in 2013. In simple dollar terms, the decline in U.S. public sector funding has been more than offset by a rise in U.S. private research spending, but the two are not substitutes, as each tends to specialize in different kinds of R&D. This chart appears in the November 2016 Amber Waves feature, "U.S. Agricultural R&D in an Era of Falling Public Funding."
Thursday, May 11, 2017
From 1948 to 2013, U.S. farm sector output grew by 170 percent with about the same level of farm input use over the period. This output growth resulted mainly from gains in productivity, as measured by total factor productivity (TFP)—the difference between the growth of aggregate output and growth of aggregate inputs (such as land and labor). Between 1948 and 2013, total output grew at an average annual rate of 1.52 percent, agricultural TFP at 1.47 percent, and input use at only 0.05 percent. Long-term agricultural productivity is fueled by innovations in animal/crop genetics, chemicals, equipment, and farm organization that result from public and private research and development. This chart appears in the ERS publication Selected charts from Ag and Food Statistics: Charting the Essentials, 2017, released April 28, 2017.
Wednesday, October 12, 2016
Boosting agricultural productivity—producing more output from fewer inputs—is key to meeting expanding global food needs. Total Factor Productivity (TPF) offers a complete measure of agricultural performance, accounting for all of the land, labor, capital, and material resources used in the production process. Since the 1960s, agricultural TFP in developed countries has compensated for declining input use as output growth slowed. In more years, between 2001 and 2013, input growth in these countries declined across all factors of production for the first time. ERS estimates TFP growth using data from the Food and Agriculture Organization of the United Nations. This chart uses data from the ERS International Agricultural Productivity dataset.
Wednesday, September 14, 2016
U.S. agricultural output more than doubled between 1948 and 2013, growing on average at 1.52 percent annually. Total input use (for example, land, labor and materials such as seed and feed) grew at only 0.05 percent per year on average. Improvements in how efficiently inputs are transformed into outputs, known as Total Factor Productivity (TFP), fueled almost all of the output growth. Advancements in technology—such as improvements to machinery, seeds, and farm structures—enabled agricultural TFP to grow an average of 1.47 percent annually. This rate exceeded the productivity growth of most U.S. industries, according to data from the U.S. Bureau of Labor Statistics. In recent years, between 2007 and 2013, TFP growth has kept up with its historic rate. This strong productivity growth has offset the decline in the use of agricultural inputs, allowing agricultural output to continue to grow by 0.91 percent annually. A version of this chart is found in the September 2016 Amber Waves feature, "Productivity Growth Is Still the Major Driver in Growing U.S. Agricultural Output".
Thursday, August 18, 2016
Genetically engineered (GE) seeds are widely used in U.S. field crop production. Herbicide-tolerant (HT) crops were developed to survive the application of certain herbicides that previously would have destroyed the crop along with the targeted weeds. Insect-resistant crops contain a gene from the soil bacterium Bacillus thuringiensis (Bt) that produces a protein that is toxic to specific insects. Seeds that have both herbicide-tolerant and insect-resistant traits are referred to as “stacked.” Recent data show that the adoption of stacked corn varieties has increased from 15 percent of U.S. corn acres in 2006 to 76 percent in 2016. Adoption rates for stacked cotton varieties have also grown, from 39 percent in 2006 to 80 percent in 2016. Generally, many different GE traits—each aimed at a specific herbicide or insect—can be stacked; varieties with three or four GE traits are now common. Research suggests that stacked corn seeds have higher yields than conventional seeds or seeds with only one GE trait. This chart is based on data found in the ERS data product, Adoption of Genetically Engineered Crops in the U.S., updated July 2016.
Monday, July 25, 2016
U.S. soybeans, cotton and corn farmers have nearly universally adopted genetically engineered (GE) seeds in recent years, despite their typically higher prices. Herbicide-tolerant (HT) crops, developed to survive the application of specific herbicides that previously would have destroyed the crop along with the targeted weeds, provide farmers with a broader variety of options for weed control. Insect-resistant crops (Bt) contain a gene from the soil bacterium Bacillus thuringiensis that produces a protein toxic to specific insects, protecting the plant over its entire life. “Stacked” seed varieties carry both HT and Bt traits, and now account for a large majority of GE corn and cotton seeds. In 2016, adoption of GE varieties, including those with herbicide tolerance, insect resistance, or stacked traits, accounted for 94 percent of soybean acreage (soybeans have only HT varieties), 93 percent of cotton acreage, and 92 percent of corn acreage planted in the United States. This chart is found in the ERS data product, Adoption of Genetically Engineered Crops in the U.S., updated July 2016.
Thursday, March 24, 2016
Concentration levels in many U.S. agricultural markets have risen in recent decades, resulting in fewer buyers accounting for a growing share of purchases of agricultural commodities. This is particularly true for livestock markets. The four largest packers now account for nearly 70 percent of the value of all livestock purchased for slaughter, compared to 26 percent in 1980. For fed cattle, the concentration level is even higher, as the share of the top four firms increased from 36 percent to 85 percent between 1980 and 2012. This chart is from the ERS report, Thinning Markets in U.S. Agriculture: What are the Implications for Producers and Processors?
Wednesday, January 27, 2016
Agricultural total factor productivity (TFP) is the difference between the aggregate total output of crop/livestock commodities and the combined use of land, labor, capital and material inputs employed in farm production. Growth in TFP implies that the adoption of new technology or improved management of farm resources is increasing average productivity or efficiency of input use. From 1948 to 2013, U.S. farm sector output grew by 170 percent with about the same level of farm input use over the period, and thus the positive growth in farm sector production was substantially due to productivity growth. While aggregate input use in agriculture has been relatively stable over time, the composition of agricultural inputs (not shown in this chart) has shifted. Between 1948 and 2013, labor use declined sharply by 78 percent, land use in agriculture dropped by 26 percent, while the use of intermediate goods (such as energy, agricultural chemicals, purchased services, and seed/feed) and capital (farm machinery and buildings) expanded. Long-term agricultural productivity is fueled by innovations in animal/crop genetics, chemicals, equipment, and farm organization that result from public and private research and development. This chart is found in the ERS data product Agricultural Productivity in the U.S., updated December 2015.
Monday, November 16, 2015
Across a broad range of topics for agriculture, food, and related issues, research and development (R&D) conducted by U.S. public research institutions (State and Federal institutions) tends to emphasize different themes than R&D conducted by private firms. The two sectors have overlapping research interests in areas related to farm production—crop, animal, and farm machinery innovation. However, in areas where reaping benefits from research results is more difficult for private firms—such as in the environmental impacts of agriculture, and human nutrition/food safety—public sector research dominates. The private sector tends to focus on areas such as food manufacturing, where research benefits are more readily captured by the specific innovator. Much of the private expenditures on food R&D, which does not directly affect farm-level productivity, is on new product development rather than on improved food manufacturing processes. New technologies such as gene transfer, along with intellectual property protection, have increased private incentives for crops research, and private crop research investment has grown. This chart appears in the ERS research report, Agricultural Productivity Growth in the United States: Measurement, Trends, and Drivers, ERR-189, released July 2015.
Friday, October 23, 2015
Total U.S. livestock output grew 130 percent from 1948 to 2011, with the poultry and eggs subcategory growing much faster than meat animals (including cattle, hogs, and lamb) and dairy products. In 2011, the real value of total poultry and egg production was more than seven times its level in 1948, with an average annual growth rate exceeding 3 percent. The rapid growth of poultry production is due largely to changes in technology—advances in genetics, feed formulations, housing, and practices—and increased consumer demand. Retail prices of poultry fell in the late 1970’s and 1980’s, relative to beef and pork prices, leading to expanded poultry consumption in that period. Increased domestic consumption and exports were also driven by consumer response to an expanding range of new poultry products, as the industry moved away from a reliance on whole birds and production shifted to cut-up parts and processed products such as boneless chicken, breaded nuggets/tenders, and chicken sausages. This chart is found in the ERS report, Agricultural Productivity Growth in the United States: Measurement, Trends, and Drivers, July 2015.
Friday, October 16, 2015
The average annual rate of global agricultural output growth slowed in the 1970s and 1980s, then accelerated in the 1990s and 2000s. In the latest period estimated (2001-12), global output of total crop and livestock commodities was expanding at an average rate of 2.5 percent per year. In the decades prior to 1990, most output growth came about from intensification of input use (i.e., using more labor, capital, and material inputs per acre of agricultural land). Bringing new land into agriculture production and extending irrigation to existing agricultural land were also important sources of growth. This changed over the last two decades, as input growth slowed. In 2001-12, improvements in productivity—getting more output from existing resources—accounted for about two-thirds of the total growth in agricultural output worldwide, reflecting the use of new technology and changes in management practices by agricultural producers around the world. This chart is based on the ERS data product, International Agricultural Productivity, updated October 2015.
Monday, October 5, 2015
Agricultural technologies adopted over the last half-century, embodied in equipment, structures, seeds, and chemicals, allow farmers to use less labor. As a result, even though total agricultural production more than doubled between 1960 and 2011 (the latest estimates available), the amount of self-employed labor in agriculture fell by 70 percent, and the amount of hired labor fell by 60 percent. While most labor used on farms comes from the self-employed labor of farm families and hired labor (full and part-time employees), farmers also hire labor contractors to provide labor to farms, usually for specific tasks. Contract labor accounted for 1.2 percent of total costs in agriculture in 2011, compared to 13 percent for self-employed and hired labor. While the use of contract labor declined by half between 1960 and the mid-1980’s, tracking the decline in self-employed and hired labor, it has since grown as some farmers have shifted to contract labor in place of hired labor. A version of this chart is found in the ERS report, Agricultural Productivity Growth in the United States: Measurement, Trends, and Drivers, July 2015.