Wednesday, April 09, 2008

A Tiny Business Plan Flaw

Thanks to the lovely Rachel for sending me this link from

I post a fair bit about Monsanto and GM crops here, more recently the GM Sugar Beets that are Round Up ready and legalized thanks to a cooperative EPA with regard to allowing 1000 percent increase in the residue of the glyphosate in the beets.

Well, here's an interesting bit of news. It seems that glyphosate relies on rock phosphate for manufacture, as does the fertilizer industry. But rock phosphate is a non-renewable resource that is expected to run out in 40-50 years. The process is also extremely energy-intensive and pollution-intensive for creation, and becoming very expensive for farmers who rely on the herbicide as well as on the fertilizer inputs that the "Round Up-ready" GM crops rely on.

So, you have farmers locked into patented seeds that have to be purchased annually, that require expensive inputs and an expensive fertilizer that is eventually going to run out. Yet, Monsanto continues to crank out new Round Up-ready GM plants like nothing is wrong. Even Chinese manufacturers of the generic glyphosate are getting out of the business.

It's a system doomed to fail, and take a fair bit of the environment along with it from the pollution as well as cross-contamination of non-GM plants and the emergence of herbicide-resistant weeds. Of course, Monsanto won't have to pay for the environmental damage. That's for us to take care of.

So, why are we in the U.S. still in the business to the tune of a 700 percent increase in stock value for Monsanto? Why is Monsanto's GM seed business seeking global domination for a short-term gain and risky future?

The only bright spot is that the intensive inputs that fuel these misguided practices of industrial agriculture are on borrowed time, much like our fossil fuel dependency. But then, Monsanto has a few decades to come up with something just as destructive and plenty of capital post-corn ethanol madness. Then again, we could get sane and go back to sustainable methods.

Now, that's just crazy talk.


Rachel said...

I'm really glad I forwarded this to you because we have differing views and vive le difference! I'm actually very hopeful about stories like this because Monsanto can't force people to buy products that are just unfeasibly expensive. The pinch in the wallet is going to do more to lessen reliance on fossil resource-laden farming instruments like Round Up and chemical fertilzers derived from petrocarbons than any well intentioned enviro-message.

What I find fascinating is the fact that with the rise in oil and knock on impacts on gas (shipping) and fertilizers, conventionally mass-produced agri-products are rising in price faster than organic, locally grown crops. This will stimulate demand for organic crops, which in turn makes local farming more profitable. For once, capitalism is working to "our" benefit!

Expatriate Chef said...

Heh. You are more of an optimist! I guess I've read too much on how greed drives the food and ag industry and profits trump consumer health and environment repeatedly. I have faith that folks like Monsanto will keep at it until it drives us to the brink.

Which is why I am so supportive of change and eating local and taking a small hold where it can plant itself and grow. I can effect change at that level, I can do something there. I've tried to kill the subsidy and beg for reform, my congressmen ignored me. The Farm Bill will be a shadow of what it should have been. But we can't wait for the greed-mongers to be overthrown, enlightened or give up.

We just have to quietly change the game from the grassroots up. Be warned, tho, they will use all the lobbying power they can to prevent this change. Already are.

Rachel said...

I agree with you that the corporations are stacking the deck. But at the end of the day, even capitalism can't force farmers to buy what is just unfeasibly expensive. Monsanto's products have been developed for an era that is absolutely vanishing. Hah. Of course, I speak with near-total ignorance of the current Farm Bill, so I acknowledge that you are vastly better informed than I am!

Expatriate Chef said...

No, it's good to be optimistic and it's things like this that may force change. I hope so, I really do. I just worry about Big Ag and the massive power like the current pesticide issue for the farm bill that would prevent more farmers from getting funding for going organic.

There are some interesting bright spots like this carbon-negative farming method that is based on safe, organic methods read it here.

Rachel said...

you do make a good point about there not being subsidies or government provision to encourage a switch to organics; if you think the US is bad, I could make your hair curl with what happens with the EU's Common Agricultural Policy (CAP). The lunacy of the policy is that it encourages overproduction because it pays subsidies to farmers based on yields, then takes the overproduction and floods developing world markets with cheap produce, stifling local production. It's an absolute horror, and attempts by European Union members to reform the system (like the UK, which, not coincidentally, has a very strong organic movement) are totally smothered by France, which benefits enormously from the system.

Paul said...

Expatriate chef,I prefer to eat fresh produce and other food products raised and processed close to home. That's what most city and rural folks have in common.

However, this economic system of capitalism, or "greed" as you put it, like it or not, controls the activities of all enterprises, whether one runs an organic farm near a large city or a large farm located in the middle of the boondocks. This system has no favorites, except it forces everyone to manage resources well, or they're out of business.

I'm not defending fossil fuels, but for now, until better alternatives come along, it's the only economically feasible game in town.

Thanks to the latest technology of high tech equipment, chemicals and fertilizers, today's farmers can target and limit the use of pesticides and fertilizers that actually minimizes their impact on the environment.

Incidentally, this "fossil resource laden" farming and "fossil resource laden" private industry provides you with everything you own and offers you the opportunity and the freedom to have a lifestyle free from the daily task that consumes most people's time in the third world, of gathering food to survive. Instead of spending 90% of disposable income on food, today's consumer spends less than 10%.

Yes, most city and rural folks want to make the world a better place. In time, that is taking place. The culprit is not Monsanto or petrocarbons. It's the fear of the unknown (while blaming Big Ag and the business lobby) and the perceived inability of people to do anything to improve their world without massive governmental intervention.

Expatriate Chef said...

I suppose that would be the case for many Americans who buy food unaware. Around here, we've opted out of the Big Ag system as much as possible. I buy all meats, eggs, and milk direct from farmers and all produce in season as well direct from farmers. Outside of that, we try to purchase organic and fair trade on imported items. Our food bill is definitely NOT ten percent of our budget. It's significantly more. We made that choice knowingly and make sacrifices to prioritize food quality and source. I realize I am lucky to be able to make this choice. I also have realized that I need to do more to support others' right to decent food.

The current system is the status quo, but that status quo is not working and is not sustainable. Each of us is responsible for finding a better way and steering toward it with political action and consumer demand.

Paul said...

I appreciate your commitment to purchasing the locally grown food, even if it costs more. More power to you. If the choice is available, what's not to like about it? I buy produce from our local farmer's market, too. I do have my limits of how much I'm willing to spend, however.

One thing that will probably remain in the competition for America's food dollar is, in a free enterprise system, taste is the number one American consumer option for choosing which food to buy (source, Meridith Corporation). Next, is price.

As for the status quo for agriculture, the alternative is not sustainable either, nor for 95% of consumers, as agricultural output would be reduced dramatically from its current levels. The U.S. would be forced to import the majority of its food needs, due to rotational crop demands from organic farming and more diseases and pests, not to mention competition from weeds.

In my spare time away from the fields, I surf the internet looking for ideas that would work in my part of the country. I've read many testimonials of proponents of organic agriculture. Largely operated on a smaller scale, most admit to one drawback...they have to have a well paying nonfarm job that subsidizes the operation. Even when they are located near large metropolitan centers, their greatest challenge is controlling their costs and maintaining enough revenue from the crops to be self supporting. I can relate to that. Controlling costs and maximizing revenue is a constant challenge on my farm.

However, my perception of organic farming proponents is they are not serious or focused enough on the economic aspect.

For traditional agriculture to be economically viable to pay the salary of one worker or manager, $150,000 of gross revenue is required to pay all costs and pay the worker or manager. Organic farms face the same hurdle, (it may be a different threshold, however) yet it does not seem to even be on their radar screen.

Both forms of ag, Big Ag and Little Ag, must face the same demons, of controlling input costs and maintaining revenue above all costs.

Perhaps the good that can come from dialogue like this and from people expressing differing opinions is to challenge each other to continue the quest for improving the system of food production. I really dislike paying for chemicals and such. However, I dislike poverty more.

I support organic food production wherever it can be sustained economically. But even more, I'm in favor of preventing world-wide starvation and malnutrition on a massive scale. Without traditional agricultural production, we would be experiencing this today.

But thanks, expatriate chef, for an enlightening dialogue. Best wishes.

From a Kansas Wheat farmer.