Council: More ag investment needed

Council: More ag investment needed

- Ag knowledge can be adapted to other regions. - Existing knowledge not being adequately utilized. - U.S. share of global ag R&D

Council: More ag investment needed
MORE policy influencers are paying attention to the role innovation and investment play in meeting growing global food demand.

Echoing other recent studies on the subject, the Chicago Council on Global Affairs released a report April 24 making the case that greater international collaboration and investment in agricultural research is critical both to safeguard productivity gains made over the past half-century and to meet future food demand.

Authored by University of Minnesota researchers Philip Pardey and Jason Beddow, the report concludes that most sub-Saharan African countries could potentially access as much as 25 times their local agricultural knowledge simply by adapting and adopting scientific breakthroughs from other countries.

"A new way of thinking about agricultural investments and innovation must be embraced to take advantage of such opportunities to increase agricultural production and increase the efficiencies of investment at all levels, from the local to the international level," Pardey said. "A more international approach is urgently needed as the lag between research investments and commercial adoption is extremely lengthy."

Beddow noted that the current system of knowledge transfer in agriculture and food production does not adequately take advantage of the great amount of knowledge that already exists around the world that could easily be adapted to local regions in the developing world.

Pointing to research investments as an area that needs further attention, the report notes that the share of research and development (R&D) investments made by countries in the developed world, specifically the U.S., has dropped in recent years. Meanwhile, investments in emerging agricultural economies such as Brazil, China, India and South Africa are growing.

The U.S. share of global agricultural R&D fell from 21% in 1960 to only 13% in 2009. China's share, on the other hand, grew from 13% to 19% of total agricultural research spending worldwide.

Contemporaneously, private-sector R&D has played an increasingly important role in agricultural innovation. The U.S. Department of Agriculture's Economic Research Service (ERS), for example, recently noted that 53% of the $11.3 billion spent on U.S. food and agriculture R&D comes from the private sector (Figure) and that private spending has exceeded public investment in most years since the late 1970s.

According to ERS, public research has been oriented toward "basic or fundamental science and scientific training" in areas such as food safety that have "high social value" but relatively weak private-sector incentives are relatively weak. Common areas of public R&D funding include environmental and natural resource conservation, community development and social issues and economic and policy analysis.

Private-sector research, on the other hand, far outpaces the public sector in food-specific research, with more emphasis on product development. For agricultural production research, private investment is most heavily concentrated in the crop chemical, seed/traits and farm machinery segments, with investment in seeds and traits development more than doubling from 1994 to 2010.

Several recent studies have attempted to quantify the importance of innovation in agricultural productivity, including a study from Brazilian consultancy Celeres that found that biotechnology has added $18.8 billion in accumulated commercial benefits to Brazil's economy since 1996 (Feedstuffs, Feb. 18).

Earlier this month, the London School of Economics released a report arguing that further investment in biotechnology is essential to feeding an estimated 9 billion people by 2050 (Feedstuffs, April 22).

According to the report commissioned by the Chicago Council, agricultural R&D is a solid investment.

"In the U.S. over the past half-century, every dollar invested in public agricultural R&D returned benefits valued at between $20 and $30," the report notes.

"Changes in U.S. corn production illustrate how investments in research and development have paid off in productivity gains. U.S corn production grew from 2.7 billion bu. in 1900 to just under 12.4 billion in 2011, or 36% of the entire world's output, while over the same period, the amount of land under corn production decreased. A sizeable share of the growth derived from use of technological innovations (notably, new hybrid varieties of corn) resulted from investments in research," the council said.

The report concludes by arguing for a broader global effort to transfer knowledge among productive regions of the world and for additional collaboration between the public and private sectors.

"Failing to take a more comprehensive perspective on the entire world's innovative capacity related to food and agriculture is bound to let some especially promising and economically rewarding opportunities slip by," the council warned.

Volume:85 Issue:17

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