CHAPTER 1FARM MANAGEMENT IN THE 21ST

CENTURY

AGRI 4411 Farm Management - Chapter 1

Objectives

Discuss how changes in the structure and technology of agriculture in the twenty-first century will affect the next generation of farm and ranch managers

Identify the management skills that future farmers and ranchers will need to respond to these changes

Decision Making

Manager ndash Makes decisionsndash Using economic principles record summaries

investment analysis financial statements etc Decisions

ndash Input and output levelsndash When and how to acquire resourcesndash Analyze risk and returns from new technology

adjusting farm size changing enterprises

21st Century Manager

Technology Management information

systemsndash Aided by electronic

innovations

More competition with Non-Ag Businesses for land labor and capital resourcesNO3-N Pre-Season Residual Map

from 0 to 12 Inches of Soil Depth

Structure of Farms amp Ranches

Farms decreasing Average farm size increasingWhy Labor saving technology Employment opportunity off-farm Cost of labor increasing faster than cost of capital Desire for higher standard of living (off-farm income) Cost of new technology requires spreading cost over more

production Also fixed costs to learn new skills in production

marketing and finance

Alternative paths for farm and ranch businesses

Trends

Farm sizes will continue to increase

Sophisticated management skills

Centralized production (poultry industry)

Management segregated into more layers

ndash More specialized

Information Age

Decision making tools and budgeting tools underused in the past because data was hard to get or to complicated to analyze

GPS in crop production Miniature electronic sensors

(Animals) Portable computers

ndash Increase speed accuracy and availability of information sharing

Financial Management

Sources of farm credit more vertically integrated

ndash Increased competition with non-farm sector

ndash require detailed documentation of financial performance and credit needs

ndash Conformity to generally accepted accounting principles (GAAP)

ndash Cash accounting will not always be acceptable

ndash Auditsndash Controlling assets more important

than owning them

Financial

electronic banking standardized financial statements electronic accounting

Human Resources

Team of employees Need to offer wages

benefits and working conditions comparable to non-farm

Increased regulations with chemicals and equipment

Specialized responsibilities Paid consultants and

advisors

Producing to Meet Consumer Needs

Ex Livestock with uniform size to fit processing equipment standard packaging and quality levels

Foreign markets important Niche market important

ndash Ex organic farming

Vertical Integration

Farmers may fill one niche in the supply chainndash eg raising dairy replacement heifers ndash producing bedding plants for home gardenersndash buyer supplied inputs such as pigs or broilers

finished in contract facilities on independent farms

Highly specialized highly skilled May have contracts up and down the chain Quality and timeliness are critical

Environment amp Health Concerns

Food quality Food safety Present and future soil

condition Agriculture waste (air and

water quality) Successful managers will

generate profit while conserving resources and minimizing environmental problems

New Technology

Biotechnology offers production efficiency

Precision FarmingGenetic

characteristics and growth stimulants

Flow of Information

more automated collection of information easier to classify and analyze how much can the human mind comprehend what information is relevant electronic communication is fast but

impersonal

More Differentiation of Raw Materials

genetic engineering product identification and separation specialized markets advance contracts

Globalization

World economy is more integrated Trade barriers are being reduced Farmers from all countries will compete for

markets All countries will compete for resources1048673There

will be winners and losers

Smaller Farms Will Continue to Form Alliances

achieve efficiencies specialize less independence more difficult to coordinate cooperatives

Rural Communities

Farmers will be scarcer More rural residents May be residential centers

but not commerce centers Quality of life will be more

important

Agriculture must learn to serve an affluent society

Final Thoughts

As long as people eat there will be a living in agriculture

Agriculture is a mature industry Extreme economic conditions tend to turn

around Good managers will take advantage of the

good times and protect against the bad

Objectives

Discuss how changes in the structure and technology of agriculture in the twenty-first century will affect the next generation of farm and ranch managers

Identify the management skills that future farmers and ranchers will need to respond to these changes

Decision Making

Manager ndash Makes decisionsndash Using economic principles record summaries

investment analysis financial statements etc Decisions

ndash Input and output levelsndash When and how to acquire resourcesndash Analyze risk and returns from new technology

adjusting farm size changing enterprises

21st Century Manager

Technology Management information

systemsndash Aided by electronic

innovations

More competition with Non-Ag Businesses for land labor and capital resourcesNO3-N Pre-Season Residual Map

from 0 to 12 Inches of Soil Depth

Structure of Farms amp Ranches

Farms decreasing Average farm size increasingWhy Labor saving technology Employment opportunity off-farm Cost of labor increasing faster than cost of capital Desire for higher standard of living (off-farm income) Cost of new technology requires spreading cost over more

production Also fixed costs to learn new skills in production

marketing and finance

Alternative paths for farm and ranch businesses

Trends

Farm sizes will continue to increase

Sophisticated management skills

Centralized production (poultry industry)

Management segregated into more layers

ndash More specialized

Information Age

Decision making tools and budgeting tools underused in the past because data was hard to get or to complicated to analyze

GPS in crop production Miniature electronic sensors

(Animals) Portable computers

ndash Increase speed accuracy and availability of information sharing

Financial Management

Sources of farm credit more vertically integrated

ndash Increased competition with non-farm sector

ndash require detailed documentation of financial performance and credit needs

ndash Conformity to generally accepted accounting principles (GAAP)

ndash Cash accounting will not always be acceptable

ndash Auditsndash Controlling assets more important

than owning them

Financial

electronic banking standardized financial statements electronic accounting

Human Resources

Team of employees Need to offer wages

benefits and working conditions comparable to non-farm

Increased regulations with chemicals and equipment

Specialized responsibilities Paid consultants and

advisors

Producing to Meet Consumer Needs

Ex Livestock with uniform size to fit processing equipment standard packaging and quality levels

Foreign markets important Niche market important

ndash Ex organic farming

Vertical Integration

Farmers may fill one niche in the supply chainndash eg raising dairy replacement heifers ndash producing bedding plants for home gardenersndash buyer supplied inputs such as pigs or broilers

finished in contract facilities on independent farms

Highly specialized highly skilled May have contracts up and down the chain Quality and timeliness are critical

Environment amp Health Concerns

Food quality Food safety Present and future soil

condition Agriculture waste (air and

water quality) Successful managers will

generate profit while conserving resources and minimizing environmental problems

New Technology

Biotechnology offers production efficiency

Precision FarmingGenetic

characteristics and growth stimulants

Flow of Information

more automated collection of information easier to classify and analyze how much can the human mind comprehend what information is relevant electronic communication is fast but

impersonal

More Differentiation of Raw Materials

genetic engineering product identification and separation specialized markets advance contracts

Globalization

World economy is more integrated Trade barriers are being reduced Farmers from all countries will compete for

markets All countries will compete for resources1048673There

will be winners and losers

Smaller Farms Will Continue to Form Alliances

achieve efficiencies specialize less independence more difficult to coordinate cooperatives

Rural Communities

Farmers will be scarcer More rural residents May be residential centers

but not commerce centers Quality of life will be more

important

Agriculture must learn to serve an affluent society

Final Thoughts

As long as people eat there will be a living in agriculture

Agriculture is a mature industry Extreme economic conditions tend to turn

around Good managers will take advantage of the

good times and protect against the bad

Decision Making

Manager ndash Makes decisionsndash Using economic principles record summaries

investment analysis financial statements etc Decisions

ndash Input and output levelsndash When and how to acquire resourcesndash Analyze risk and returns from new technology

adjusting farm size changing enterprises

21st Century Manager

Technology Management information

systemsndash Aided by electronic

innovations

More competition with Non-Ag Businesses for land labor and capital resourcesNO3-N Pre-Season Residual Map

from 0 to 12 Inches of Soil Depth

Structure of Farms amp Ranches

Farms decreasing Average farm size increasingWhy Labor saving technology Employment opportunity off-farm Cost of labor increasing faster than cost of capital Desire for higher standard of living (off-farm income) Cost of new technology requires spreading cost over more

production Also fixed costs to learn new skills in production

marketing and finance

Alternative paths for farm and ranch businesses

Trends

Farm sizes will continue to increase

Sophisticated management skills

Centralized production (poultry industry)

Management segregated into more layers

ndash More specialized

Information Age

Decision making tools and budgeting tools underused in the past because data was hard to get or to complicated to analyze

GPS in crop production Miniature electronic sensors

(Animals) Portable computers

ndash Increase speed accuracy and availability of information sharing

Financial Management

Sources of farm credit more vertically integrated

ndash Increased competition with non-farm sector

ndash require detailed documentation of financial performance and credit needs

ndash Conformity to generally accepted accounting principles (GAAP)

ndash Cash accounting will not always be acceptable

ndash Auditsndash Controlling assets more important

than owning them

Financial

electronic banking standardized financial statements electronic accounting

Human Resources

Team of employees Need to offer wages

benefits and working conditions comparable to non-farm

Increased regulations with chemicals and equipment

Specialized responsibilities Paid consultants and

advisors

Producing to Meet Consumer Needs

Ex Livestock with uniform size to fit processing equipment standard packaging and quality levels

Foreign markets important Niche market important

ndash Ex organic farming

Vertical Integration

Farmers may fill one niche in the supply chainndash eg raising dairy replacement heifers ndash producing bedding plants for home gardenersndash buyer supplied inputs such as pigs or broilers

finished in contract facilities on independent farms

Highly specialized highly skilled May have contracts up and down the chain Quality and timeliness are critical

Environment amp Health Concerns

Food quality Food safety Present and future soil

condition Agriculture waste (air and

water quality) Successful managers will

generate profit while conserving resources and minimizing environmental problems

New Technology

Biotechnology offers production efficiency

Precision FarmingGenetic

characteristics and growth stimulants

Flow of Information

more automated collection of information easier to classify and analyze how much can the human mind comprehend what information is relevant electronic communication is fast but

impersonal

More Differentiation of Raw Materials

genetic engineering product identification and separation specialized markets advance contracts

Globalization

World economy is more integrated Trade barriers are being reduced Farmers from all countries will compete for

markets All countries will compete for resources1048673There

will be winners and losers

Smaller Farms Will Continue to Form Alliances

achieve efficiencies specialize less independence more difficult to coordinate cooperatives

Rural Communities

Farmers will be scarcer More rural residents May be residential centers

but not commerce centers Quality of life will be more

important

Agriculture must learn to serve an affluent society

Final Thoughts

As long as people eat there will be a living in agriculture

Agriculture is a mature industry Extreme economic conditions tend to turn

around Good managers will take advantage of the

good times and protect against the bad

21st Century Manager

Technology Management information

systemsndash Aided by electronic

innovations

More competition with Non-Ag Businesses for land labor and capital resourcesNO3-N Pre-Season Residual Map

from 0 to 12 Inches of Soil Depth

Structure of Farms amp Ranches

Farms decreasing Average farm size increasingWhy Labor saving technology Employment opportunity off-farm Cost of labor increasing faster than cost of capital Desire for higher standard of living (off-farm income) Cost of new technology requires spreading cost over more

production Also fixed costs to learn new skills in production

marketing and finance

Alternative paths for farm and ranch businesses

Trends

Farm sizes will continue to increase

Sophisticated management skills

Centralized production (poultry industry)

Management segregated into more layers

ndash More specialized

Information Age

Decision making tools and budgeting tools underused in the past because data was hard to get or to complicated to analyze

GPS in crop production Miniature electronic sensors

(Animals) Portable computers

ndash Increase speed accuracy and availability of information sharing

Financial Management

Sources of farm credit more vertically integrated

ndash Increased competition with non-farm sector

ndash require detailed documentation of financial performance and credit needs

ndash Conformity to generally accepted accounting principles (GAAP)

ndash Cash accounting will not always be acceptable

ndash Auditsndash Controlling assets more important

than owning them

Financial

electronic banking standardized financial statements electronic accounting

Human Resources

Team of employees Need to offer wages

benefits and working conditions comparable to non-farm

Increased regulations with chemicals and equipment

Specialized responsibilities Paid consultants and

advisors

Producing to Meet Consumer Needs

Ex Livestock with uniform size to fit processing equipment standard packaging and quality levels

Foreign markets important Niche market important

ndash Ex organic farming

Vertical Integration

Farmers may fill one niche in the supply chainndash eg raising dairy replacement heifers ndash producing bedding plants for home gardenersndash buyer supplied inputs such as pigs or broilers

finished in contract facilities on independent farms

Highly specialized highly skilled May have contracts up and down the chain Quality and timeliness are critical

Environment amp Health Concerns

Food quality Food safety Present and future soil

condition Agriculture waste (air and

water quality) Successful managers will

generate profit while conserving resources and minimizing environmental problems

New Technology

Biotechnology offers production efficiency

Precision FarmingGenetic

characteristics and growth stimulants

Flow of Information

more automated collection of information easier to classify and analyze how much can the human mind comprehend what information is relevant electronic communication is fast but

impersonal

More Differentiation of Raw Materials

genetic engineering product identification and separation specialized markets advance contracts

Globalization

World economy is more integrated Trade barriers are being reduced Farmers from all countries will compete for

markets All countries will compete for resources1048673There

will be winners and losers

Smaller Farms Will Continue to Form Alliances

achieve efficiencies specialize less independence more difficult to coordinate cooperatives

Rural Communities

Farmers will be scarcer More rural residents May be residential centers

but not commerce centers Quality of life will be more

important

Agriculture must learn to serve an affluent society

Final Thoughts

As long as people eat there will be a living in agriculture

Agriculture is a mature industry Extreme economic conditions tend to turn

around Good managers will take advantage of the

good times and protect against the bad

Structure of Farms amp Ranches

Farms decreasing Average farm size increasingWhy Labor saving technology Employment opportunity off-farm Cost of labor increasing faster than cost of capital Desire for higher standard of living (off-farm income) Cost of new technology requires spreading cost over more

production Also fixed costs to learn new skills in production

marketing and finance

Alternative paths for farm and ranch businesses

Trends

Farm sizes will continue to increase

Sophisticated management skills

Centralized production (poultry industry)

Management segregated into more layers

ndash More specialized

Information Age

Decision making tools and budgeting tools underused in the past because data was hard to get or to complicated to analyze

GPS in crop production Miniature electronic sensors

(Animals) Portable computers

ndash Increase speed accuracy and availability of information sharing

Financial Management

Sources of farm credit more vertically integrated

ndash Increased competition with non-farm sector

ndash require detailed documentation of financial performance and credit needs

ndash Conformity to generally accepted accounting principles (GAAP)

ndash Cash accounting will not always be acceptable

ndash Auditsndash Controlling assets more important

than owning them

Financial

electronic banking standardized financial statements electronic accounting

Human Resources

Team of employees Need to offer wages

benefits and working conditions comparable to non-farm

Increased regulations with chemicals and equipment

Specialized responsibilities Paid consultants and

advisors

Producing to Meet Consumer Needs

Ex Livestock with uniform size to fit processing equipment standard packaging and quality levels

Foreign markets important Niche market important

ndash Ex organic farming

Vertical Integration

Farmers may fill one niche in the supply chainndash eg raising dairy replacement heifers ndash producing bedding plants for home gardenersndash buyer supplied inputs such as pigs or broilers

finished in contract facilities on independent farms

Highly specialized highly skilled May have contracts up and down the chain Quality and timeliness are critical

Environment amp Health Concerns

Food quality Food safety Present and future soil

condition Agriculture waste (air and

water quality) Successful managers will

generate profit while conserving resources and minimizing environmental problems

New Technology

Biotechnology offers production efficiency

Precision FarmingGenetic

characteristics and growth stimulants

Flow of Information

more automated collection of information easier to classify and analyze how much can the human mind comprehend what information is relevant electronic communication is fast but

impersonal

More Differentiation of Raw Materials

genetic engineering product identification and separation specialized markets advance contracts

Globalization

World economy is more integrated Trade barriers are being reduced Farmers from all countries will compete for

markets All countries will compete for resources1048673There

will be winners and losers

Smaller Farms Will Continue to Form Alliances

achieve efficiencies specialize less independence more difficult to coordinate cooperatives

Rural Communities

Farmers will be scarcer More rural residents May be residential centers

but not commerce centers Quality of life will be more

important

Agriculture must learn to serve an affluent society

Final Thoughts

As long as people eat there will be a living in agriculture

Agriculture is a mature industry Extreme economic conditions tend to turn

around Good managers will take advantage of the

good times and protect against the bad

Alternative paths for farm and ranch businesses

Trends

Farm sizes will continue to increase

Sophisticated management skills

Centralized production (poultry industry)

Management segregated into more layers

ndash More specialized

Information Age

Decision making tools and budgeting tools underused in the past because data was hard to get or to complicated to analyze

GPS in crop production Miniature electronic sensors

(Animals) Portable computers

ndash Increase speed accuracy and availability of information sharing

Financial Management

Sources of farm credit more vertically integrated

ndash Increased competition with non-farm sector

ndash require detailed documentation of financial performance and credit needs

ndash Conformity to generally accepted accounting principles (GAAP)

ndash Cash accounting will not always be acceptable

ndash Auditsndash Controlling assets more important

than owning them

Financial

electronic banking standardized financial statements electronic accounting

Human Resources

Team of employees Need to offer wages

benefits and working conditions comparable to non-farm

Increased regulations with chemicals and equipment

Specialized responsibilities Paid consultants and

advisors

Producing to Meet Consumer Needs

Ex Livestock with uniform size to fit processing equipment standard packaging and quality levels

Foreign markets important Niche market important

ndash Ex organic farming

Vertical Integration

Farmers may fill one niche in the supply chainndash eg raising dairy replacement heifers ndash producing bedding plants for home gardenersndash buyer supplied inputs such as pigs or broilers

finished in contract facilities on independent farms

Highly specialized highly skilled May have contracts up and down the chain Quality and timeliness are critical

Environment amp Health Concerns

Food quality Food safety Present and future soil

condition Agriculture waste (air and

water quality) Successful managers will

generate profit while conserving resources and minimizing environmental problems

New Technology

Biotechnology offers production efficiency

Precision FarmingGenetic

characteristics and growth stimulants

Flow of Information

more automated collection of information easier to classify and analyze how much can the human mind comprehend what information is relevant electronic communication is fast but

impersonal

More Differentiation of Raw Materials

genetic engineering product identification and separation specialized markets advance contracts

Globalization

World economy is more integrated Trade barriers are being reduced Farmers from all countries will compete for

markets All countries will compete for resources1048673There

will be winners and losers

Smaller Farms Will Continue to Form Alliances

achieve efficiencies specialize less independence more difficult to coordinate cooperatives

Rural Communities

Farmers will be scarcer More rural residents May be residential centers

but not commerce centers Quality of life will be more

important

Agriculture must learn to serve an affluent society

Final Thoughts

As long as people eat there will be a living in agriculture

Agriculture is a mature industry Extreme economic conditions tend to turn

around Good managers will take advantage of the

good times and protect against the bad

Trends

Farm sizes will continue to increase

Sophisticated management skills

Centralized production (poultry industry)

Management segregated into more layers

ndash More specialized

Information Age

Decision making tools and budgeting tools underused in the past because data was hard to get or to complicated to analyze

GPS in crop production Miniature electronic sensors

(Animals) Portable computers

ndash Increase speed accuracy and availability of information sharing

Financial Management

Sources of farm credit more vertically integrated

ndash Increased competition with non-farm sector

ndash require detailed documentation of financial performance and credit needs

ndash Conformity to generally accepted accounting principles (GAAP)

ndash Cash accounting will not always be acceptable

ndash Auditsndash Controlling assets more important

than owning them

Financial

electronic banking standardized financial statements electronic accounting

Human Resources

Team of employees Need to offer wages

benefits and working conditions comparable to non-farm

Increased regulations with chemicals and equipment

Specialized responsibilities Paid consultants and

advisors

Producing to Meet Consumer Needs

Ex Livestock with uniform size to fit processing equipment standard packaging and quality levels

Foreign markets important Niche market important

ndash Ex organic farming

Vertical Integration

Farmers may fill one niche in the supply chainndash eg raising dairy replacement heifers ndash producing bedding plants for home gardenersndash buyer supplied inputs such as pigs or broilers

finished in contract facilities on independent farms

Highly specialized highly skilled May have contracts up and down the chain Quality and timeliness are critical

Environment amp Health Concerns

Food quality Food safety Present and future soil

condition Agriculture waste (air and

water quality) Successful managers will

generate profit while conserving resources and minimizing environmental problems

New Technology

Biotechnology offers production efficiency

Precision FarmingGenetic

characteristics and growth stimulants

Flow of Information

more automated collection of information easier to classify and analyze how much can the human mind comprehend what information is relevant electronic communication is fast but

impersonal

More Differentiation of Raw Materials

genetic engineering product identification and separation specialized markets advance contracts

Globalization

World economy is more integrated Trade barriers are being reduced Farmers from all countries will compete for

markets All countries will compete for resources1048673There

will be winners and losers

Smaller Farms Will Continue to Form Alliances

achieve efficiencies specialize less independence more difficult to coordinate cooperatives

Rural Communities

Farmers will be scarcer More rural residents May be residential centers

but not commerce centers Quality of life will be more

important

Agriculture must learn to serve an affluent society

Final Thoughts

As long as people eat there will be a living in agriculture

Agriculture is a mature industry Extreme economic conditions tend to turn

around Good managers will take advantage of the

good times and protect against the bad

Information Age

Decision making tools and budgeting tools underused in the past because data was hard to get or to complicated to analyze

GPS in crop production Miniature electronic sensors

(Animals) Portable computers

ndash Increase speed accuracy and availability of information sharing

Financial Management

Sources of farm credit more vertically integrated

ndash Increased competition with non-farm sector

ndash require detailed documentation of financial performance and credit needs

ndash Conformity to generally accepted accounting principles (GAAP)

ndash Cash accounting will not always be acceptable

ndash Auditsndash Controlling assets more important

than owning them

Financial

electronic banking standardized financial statements electronic accounting

Human Resources

Team of employees Need to offer wages

benefits and working conditions comparable to non-farm

Increased regulations with chemicals and equipment

Specialized responsibilities Paid consultants and

advisors

Producing to Meet Consumer Needs

Ex Livestock with uniform size to fit processing equipment standard packaging and quality levels

Foreign markets important Niche market important

ndash Ex organic farming

Vertical Integration

Farmers may fill one niche in the supply chainndash eg raising dairy replacement heifers ndash producing bedding plants for home gardenersndash buyer supplied inputs such as pigs or broilers

finished in contract facilities on independent farms

Highly specialized highly skilled May have contracts up and down the chain Quality and timeliness are critical

Environment amp Health Concerns

Food quality Food safety Present and future soil

condition Agriculture waste (air and

water quality) Successful managers will

generate profit while conserving resources and minimizing environmental problems

New Technology

Biotechnology offers production efficiency

Precision FarmingGenetic

characteristics and growth stimulants

Flow of Information

more automated collection of information easier to classify and analyze how much can the human mind comprehend what information is relevant electronic communication is fast but

impersonal

More Differentiation of Raw Materials

genetic engineering product identification and separation specialized markets advance contracts

Globalization

World economy is more integrated Trade barriers are being reduced Farmers from all countries will compete for

markets All countries will compete for resources1048673There

will be winners and losers

Smaller Farms Will Continue to Form Alliances

achieve efficiencies specialize less independence more difficult to coordinate cooperatives

Rural Communities

Farmers will be scarcer More rural residents May be residential centers

but not commerce centers Quality of life will be more

important

Agriculture must learn to serve an affluent society

Final Thoughts

As long as people eat there will be a living in agriculture

Agriculture is a mature industry Extreme economic conditions tend to turn

around Good managers will take advantage of the

good times and protect against the bad

Financial Management

Sources of farm credit more vertically integrated

ndash Increased competition with non-farm sector

ndash require detailed documentation of financial performance and credit needs

ndash Conformity to generally accepted accounting principles (GAAP)

ndash Cash accounting will not always be acceptable

ndash Auditsndash Controlling assets more important

than owning them

Financial

electronic banking standardized financial statements electronic accounting

Human Resources

Team of employees Need to offer wages

benefits and working conditions comparable to non-farm

Increased regulations with chemicals and equipment

Specialized responsibilities Paid consultants and

advisors

Producing to Meet Consumer Needs

Ex Livestock with uniform size to fit processing equipment standard packaging and quality levels

Foreign markets important Niche market important

ndash Ex organic farming

Vertical Integration

Farmers may fill one niche in the supply chainndash eg raising dairy replacement heifers ndash producing bedding plants for home gardenersndash buyer supplied inputs such as pigs or broilers

finished in contract facilities on independent farms

Highly specialized highly skilled May have contracts up and down the chain Quality and timeliness are critical

Environment amp Health Concerns

Food quality Food safety Present and future soil

condition Agriculture waste (air and

water quality) Successful managers will

generate profit while conserving resources and minimizing environmental problems

New Technology

Biotechnology offers production efficiency

Precision FarmingGenetic

characteristics and growth stimulants

Flow of Information

more automated collection of information easier to classify and analyze how much can the human mind comprehend what information is relevant electronic communication is fast but

impersonal

More Differentiation of Raw Materials

genetic engineering product identification and separation specialized markets advance contracts

Globalization

World economy is more integrated Trade barriers are being reduced Farmers from all countries will compete for

markets All countries will compete for resources1048673There

will be winners and losers

Smaller Farms Will Continue to Form Alliances

achieve efficiencies specialize less independence more difficult to coordinate cooperatives

Rural Communities

Farmers will be scarcer More rural residents May be residential centers

but not commerce centers Quality of life will be more

important

Agriculture must learn to serve an affluent society

Final Thoughts

As long as people eat there will be a living in agriculture

Agriculture is a mature industry Extreme economic conditions tend to turn

around Good managers will take advantage of the

good times and protect against the bad

Financial

electronic banking standardized financial statements electronic accounting

Human Resources

Team of employees Need to offer wages

benefits and working conditions comparable to non-farm

Increased regulations with chemicals and equipment

Specialized responsibilities Paid consultants and

advisors

Producing to Meet Consumer Needs

Ex Livestock with uniform size to fit processing equipment standard packaging and quality levels

Foreign markets important Niche market important

ndash Ex organic farming

Vertical Integration

Farmers may fill one niche in the supply chainndash eg raising dairy replacement heifers ndash producing bedding plants for home gardenersndash buyer supplied inputs such as pigs or broilers

finished in contract facilities on independent farms

Highly specialized highly skilled May have contracts up and down the chain Quality and timeliness are critical

Environment amp Health Concerns

Food quality Food safety Present and future soil

condition Agriculture waste (air and

water quality) Successful managers will

generate profit while conserving resources and minimizing environmental problems

New Technology

Biotechnology offers production efficiency

Precision FarmingGenetic

characteristics and growth stimulants

Flow of Information

more automated collection of information easier to classify and analyze how much can the human mind comprehend what information is relevant electronic communication is fast but

impersonal

More Differentiation of Raw Materials

genetic engineering product identification and separation specialized markets advance contracts

Globalization

World economy is more integrated Trade barriers are being reduced Farmers from all countries will compete for

markets All countries will compete for resources1048673There

will be winners and losers

Smaller Farms Will Continue to Form Alliances

achieve efficiencies specialize less independence more difficult to coordinate cooperatives

Rural Communities

Farmers will be scarcer More rural residents May be residential centers

but not commerce centers Quality of life will be more

important

Agriculture must learn to serve an affluent society

Final Thoughts

As long as people eat there will be a living in agriculture

Agriculture is a mature industry Extreme economic conditions tend to turn

around Good managers will take advantage of the

good times and protect against the bad

Human Resources

Team of employees Need to offer wages

benefits and working conditions comparable to non-farm

Increased regulations with chemicals and equipment

Specialized responsibilities Paid consultants and

advisors

Producing to Meet Consumer Needs

Ex Livestock with uniform size to fit processing equipment standard packaging and quality levels

Foreign markets important Niche market important

ndash Ex organic farming

Vertical Integration

Farmers may fill one niche in the supply chainndash eg raising dairy replacement heifers ndash producing bedding plants for home gardenersndash buyer supplied inputs such as pigs or broilers

finished in contract facilities on independent farms

Highly specialized highly skilled May have contracts up and down the chain Quality and timeliness are critical

Environment amp Health Concerns

Food quality Food safety Present and future soil

condition Agriculture waste (air and

water quality) Successful managers will

generate profit while conserving resources and minimizing environmental problems

New Technology

Biotechnology offers production efficiency

Precision FarmingGenetic

characteristics and growth stimulants

Flow of Information

more automated collection of information easier to classify and analyze how much can the human mind comprehend what information is relevant electronic communication is fast but

impersonal

More Differentiation of Raw Materials

genetic engineering product identification and separation specialized markets advance contracts

Globalization

World economy is more integrated Trade barriers are being reduced Farmers from all countries will compete for

markets All countries will compete for resources1048673There

will be winners and losers

Smaller Farms Will Continue to Form Alliances

achieve efficiencies specialize less independence more difficult to coordinate cooperatives

Rural Communities

Farmers will be scarcer More rural residents May be residential centers

but not commerce centers Quality of life will be more

important

Agriculture must learn to serve an affluent society

Final Thoughts

As long as people eat there will be a living in agriculture

Agriculture is a mature industry Extreme economic conditions tend to turn

around Good managers will take advantage of the

good times and protect against the bad

Producing to Meet Consumer Needs

Ex Livestock with uniform size to fit processing equipment standard packaging and quality levels

Foreign markets important Niche market important

ndash Ex organic farming

Vertical Integration

Farmers may fill one niche in the supply chainndash eg raising dairy replacement heifers ndash producing bedding plants for home gardenersndash buyer supplied inputs such as pigs or broilers

finished in contract facilities on independent farms

Highly specialized highly skilled May have contracts up and down the chain Quality and timeliness are critical

Environment amp Health Concerns

Food quality Food safety Present and future soil

condition Agriculture waste (air and

water quality) Successful managers will

generate profit while conserving resources and minimizing environmental problems

New Technology

Biotechnology offers production efficiency

Precision FarmingGenetic

characteristics and growth stimulants

Flow of Information

more automated collection of information easier to classify and analyze how much can the human mind comprehend what information is relevant electronic communication is fast but

impersonal

More Differentiation of Raw Materials

genetic engineering product identification and separation specialized markets advance contracts

Globalization

World economy is more integrated Trade barriers are being reduced Farmers from all countries will compete for

markets All countries will compete for resources1048673There

will be winners and losers

Smaller Farms Will Continue to Form Alliances

achieve efficiencies specialize less independence more difficult to coordinate cooperatives

Rural Communities

Farmers will be scarcer More rural residents May be residential centers

but not commerce centers Quality of life will be more

important

Agriculture must learn to serve an affluent society

Final Thoughts

As long as people eat there will be a living in agriculture

Agriculture is a mature industry Extreme economic conditions tend to turn

around Good managers will take advantage of the

good times and protect against the bad

Vertical Integration

Farmers may fill one niche in the supply chainndash eg raising dairy replacement heifers ndash producing bedding plants for home gardenersndash buyer supplied inputs such as pigs or broilers

finished in contract facilities on independent farms

Highly specialized highly skilled May have contracts up and down the chain Quality and timeliness are critical

Environment amp Health Concerns

Food quality Food safety Present and future soil

condition Agriculture waste (air and

water quality) Successful managers will

generate profit while conserving resources and minimizing environmental problems

New Technology

Biotechnology offers production efficiency

Precision FarmingGenetic

characteristics and growth stimulants

Flow of Information

more automated collection of information easier to classify and analyze how much can the human mind comprehend what information is relevant electronic communication is fast but

impersonal

More Differentiation of Raw Materials

genetic engineering product identification and separation specialized markets advance contracts

Globalization

World economy is more integrated Trade barriers are being reduced Farmers from all countries will compete for

markets All countries will compete for resources1048673There

will be winners and losers

Smaller Farms Will Continue to Form Alliances

achieve efficiencies specialize less independence more difficult to coordinate cooperatives

Rural Communities

Farmers will be scarcer More rural residents May be residential centers

but not commerce centers Quality of life will be more

important

Agriculture must learn to serve an affluent society

Final Thoughts

As long as people eat there will be a living in agriculture

Agriculture is a mature industry Extreme economic conditions tend to turn

around Good managers will take advantage of the

good times and protect against the bad

Environment amp Health Concerns

Food quality Food safety Present and future soil

condition Agriculture waste (air and

water quality) Successful managers will

generate profit while conserving resources and minimizing environmental problems

New Technology

Biotechnology offers production efficiency

Precision FarmingGenetic

characteristics and growth stimulants

Flow of Information

more automated collection of information easier to classify and analyze how much can the human mind comprehend what information is relevant electronic communication is fast but

impersonal

More Differentiation of Raw Materials

genetic engineering product identification and separation specialized markets advance contracts

Globalization

World economy is more integrated Trade barriers are being reduced Farmers from all countries will compete for

markets All countries will compete for resources1048673There

will be winners and losers

Smaller Farms Will Continue to Form Alliances

achieve efficiencies specialize less independence more difficult to coordinate cooperatives

Rural Communities

Farmers will be scarcer More rural residents May be residential centers

but not commerce centers Quality of life will be more

important

Agriculture must learn to serve an affluent society

Final Thoughts

As long as people eat there will be a living in agriculture

Agriculture is a mature industry Extreme economic conditions tend to turn

around Good managers will take advantage of the

good times and protect against the bad

New Technology

Biotechnology offers production efficiency

Precision FarmingGenetic

characteristics and growth stimulants

Flow of Information

more automated collection of information easier to classify and analyze how much can the human mind comprehend what information is relevant electronic communication is fast but

impersonal

More Differentiation of Raw Materials

genetic engineering product identification and separation specialized markets advance contracts

Globalization

World economy is more integrated Trade barriers are being reduced Farmers from all countries will compete for

markets All countries will compete for resources1048673There

will be winners and losers

Smaller Farms Will Continue to Form Alliances

achieve efficiencies specialize less independence more difficult to coordinate cooperatives

Rural Communities

Farmers will be scarcer More rural residents May be residential centers

but not commerce centers Quality of life will be more

important

Agriculture must learn to serve an affluent society

Final Thoughts

As long as people eat there will be a living in agriculture

Agriculture is a mature industry Extreme economic conditions tend to turn

around Good managers will take advantage of the

good times and protect against the bad

Flow of Information

more automated collection of information easier to classify and analyze how much can the human mind comprehend what information is relevant electronic communication is fast but

impersonal

More Differentiation of Raw Materials

genetic engineering product identification and separation specialized markets advance contracts

Globalization

World economy is more integrated Trade barriers are being reduced Farmers from all countries will compete for

markets All countries will compete for resources1048673There

will be winners and losers

Smaller Farms Will Continue to Form Alliances

achieve efficiencies specialize less independence more difficult to coordinate cooperatives

Rural Communities

Farmers will be scarcer More rural residents May be residential centers

but not commerce centers Quality of life will be more

important

Agriculture must learn to serve an affluent society

Final Thoughts

As long as people eat there will be a living in agriculture

Agriculture is a mature industry Extreme economic conditions tend to turn

around Good managers will take advantage of the

good times and protect against the bad

More Differentiation of Raw Materials

genetic engineering product identification and separation specialized markets advance contracts

Globalization

World economy is more integrated Trade barriers are being reduced Farmers from all countries will compete for

markets All countries will compete for resources1048673There

will be winners and losers

Smaller Farms Will Continue to Form Alliances

achieve efficiencies specialize less independence more difficult to coordinate cooperatives

Rural Communities

Farmers will be scarcer More rural residents May be residential centers

but not commerce centers Quality of life will be more

important

Agriculture must learn to serve an affluent society

Final Thoughts

As long as people eat there will be a living in agriculture

Agriculture is a mature industry Extreme economic conditions tend to turn

around Good managers will take advantage of the

good times and protect against the bad

Globalization

World economy is more integrated Trade barriers are being reduced Farmers from all countries will compete for

markets All countries will compete for resources1048673There

will be winners and losers

Smaller Farms Will Continue to Form Alliances

achieve efficiencies specialize less independence more difficult to coordinate cooperatives

Rural Communities

Farmers will be scarcer More rural residents May be residential centers

but not commerce centers Quality of life will be more

important

Agriculture must learn to serve an affluent society

Final Thoughts

As long as people eat there will be a living in agriculture

Agriculture is a mature industry Extreme economic conditions tend to turn

around Good managers will take advantage of the

good times and protect against the bad

Smaller Farms Will Continue to Form Alliances

achieve efficiencies specialize less independence more difficult to coordinate cooperatives

Rural Communities

Farmers will be scarcer More rural residents May be residential centers

but not commerce centers Quality of life will be more

important

Agriculture must learn to serve an affluent society

Final Thoughts

As long as people eat there will be a living in agriculture

Agriculture is a mature industry Extreme economic conditions tend to turn

around Good managers will take advantage of the

good times and protect against the bad

Rural Communities

Farmers will be scarcer More rural residents May be residential centers

but not commerce centers Quality of life will be more

important

Agriculture must learn to serve an affluent society

Final Thoughts

As long as people eat there will be a living in agriculture

Agriculture is a mature industry Extreme economic conditions tend to turn

around Good managers will take advantage of the

good times and protect against the bad

Agriculture must learn to serve an affluent society

Final Thoughts

As long as people eat there will be a living in agriculture

Agriculture is a mature industry Extreme economic conditions tend to turn

around Good managers will take advantage of the

good times and protect against the bad

Final Thoughts

As long as people eat there will be a living in agriculture

Agriculture is a mature industry Extreme economic conditions tend to turn

around Good managers will take advantage of the

good times and protect against the bad