Technology, public policy, and the changing structure of American agriculture

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Technology, public policy, and the changing structure of American agriculture
United States -- Congress. -- Office of Technology Assessment
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Technology Public Policy

and the Changing Structure

of American Agriculture

S'i'- ) Office of Technology Assessment
Washngton. D C 20510


'K' .2"




Office of Technology Assessment

Congressional Board of the 99th Congress

TED STEVENS, Alaska, Chairman

MORRIS K. UDALL, Arizona, Vice Chairman

South Carolina
Rhode Island

H&Q Technology Partners
DAVID S. POTTER, Vice Chairman
General Motors Corp. (Ret.)
General Accounting Office


Advisory Council

California Land Commission
University of Pittsburgh
Lower Colorado River Authority
Acting Director
Congressional Research Service


Michel T. Halbouty Energy Co.
University of Arizona
University of Wisconsin
Memorial Sloan-Kettering
Cancer Center



The Technology Assessment Board approves the release of this report. The views expressed in this report are not
necessarily those of the Board, OTA Advisory Council, or individual members thereof.

Technology Public Policy

and the

Changing Structure of

American Agriculture

Office of Technology Assessment
Washington, D. C. 20510

Recommended Citation:
U.S. Congress, Office of Technology Assessment, Technology, Public Policy, and the
Changing Structure of American Agriculture, OTA-F-285 (Washington, DC: U.S. Gov-
ernment Printing Office, March 1986).

Library of Congress Catalog Card Number 85-600632

For sale by the Superintendent of Documents
U.S. Government Printing Office, Washington, DC 20402


American agriculture is undergoing significant change and stress. Much of the
recent change has been attributed to the financial farm crisis caused mainly by
declining agricultural exports. However, underlying these financial difficulties are
strong technological and structural forces which will cause further changes and
adjustments in American agriculture for the remainder of this century.
Congress, concerned about the nature of these adjustments, requested the Office
of Technology Assessment (OTA) to analyze the underlying technological, struc-
tural, and political forces which impact American agriculture and to determine
the industry's probable future direction. Committees requesting the study include:
the Senate Committee on Agriculture, the Senate Small Business Committee (the
Subcommittee on the Family Farm), the Joint Economic Committee, the House Com-
mittee on Science and Technology, and the House Committee on Agriculture (the
Subcommittee on Livestock, Dairy, and Poultry; the Subcommittee on Department
Operations, Research, and Foreign Agriculture; and the Subcommittee on Forests,
Family Farms, and Energy).
In the course of preparing this report, an interim report entitled A Special Re-
port for the 1985 Farm Bill was transmitted to the requesting committees for their
use during the debates and the writing of the Food Security Act of 1985 (1985 Farm
Bill). The special report focused on assessment findings that were particularly rele-
vant for issues debated in that legislation.
This report addresses the longer run issues that technology and certain other
factors will have on American agriculture during the remainder of this century.
It focuses on the relationship of technology to: agricultural production, structural
change, rural communities, environment and natural resource base, finance and
credit, research and extension, and public policy. The assessment identifies many
benefits that new technologies will create, but these benefits will also exact sub-
stantial costs in potential adjustment problems. This report is a first step toward
understanding these interrelated problems and identifying policies to ameliorate
OTA greatly appreciates the contribution of the advisory panel, workgroups, work-
shop participants, authors of the technical background papers, and the many other
advisors and reviewers who assisted OTA from the public and private sector. Their
guidance and comments helped develop a comprehensive report. As with all OTA
studies, however, the content of this report is the sole responsibility of OTA.


Technology, Public Policy, and the Changing Structure of
American Agriculture: Advisory Panel

Frank Baker
Director, International Stockmen's School
Winrock International Livestock Research
and Training Center
James Bonnen
Department of Agricultural Economics
Michigan State University
William Brown
Chairman of the Board
Pioneer Hi-Bred International, Inc.
Frederick Buttel
Associate Professor
Department of Rural Sociology
Cornell University
Willard Cochrane
Jack Doyle
Agricultural Resources Project
Environmental Policy Institute
Washington, DC
Marcia Dudden
Dudden Farms, Inc.
Walter Ehrhardt
Ehrhardt Farms
Dean Gillette
Harvey Mudd College
Claremont College
Roger Granados
Executive Director
La Coopertiva

Richard Harwood
Program Officer
Winrock International
Charles Kidd
College of Engineering Science,
Technology, and Agriculture
Florida A&M University
Robert Lanphier III
Chairman of the Board
DICKEY-john Corp.
Edward Legates
Dean, College of the Agriculture and
Life Sciences
North Carolina State University
John Marvel*
President and General Manager
Research Division
Monsanto Agriculture Products Co.
Donella Meadows
Adjunct Professor
Resources Policy Center
Dartmouth College
Don Paarlberg
Don Reeves
Consultant, Interreligious Taskforce on
U.S. Food Policy
Milo Schanzenbach
Schanzenbach Farms
South Dakota

*Resigned May 1985.

Technology, Public Policy, and the Changing Structure
of American Agriculture: OTA Project Staff

Roger C. Herdman, Assistant Director, OTA
Health and Life Sciences Division

Walter E. Parham, Food and Renewable Resources Program Manager

Michael J. Phillips, Project Director

Yao-chi Lu, Senior Analyst

Robert C. Reining, Analyst
Juliette Linzer,1 Research Assistant
Kathryn M. Van Wyk, Editor and Writer

Administrative Staff

Patricia Durana2 and Beckie Erickson,3 Administrative Assistants
Nellie Hammond, Secretary
Carolyn Swann, Secretary

'Through May 1984.
2Through July 1985.
3After July 1985.


Chapter Page
1. Sum m ary ...................................................... 3
Part I: The Emerging Technologies
2. Emerging Technologies for Agriculture ............................ 27
3. Impacts of Emerging Technologies on Agricultural Production ....... 75
Part II: The Changing Structure of American Agriculture
4. Dynamic Structure of Agriculture ................................. 91
5. Factors Contributing to Structural Change in Agriculture ............ 109
Part III: Analyses of Technology, Public Policy, and
Agricultural Structure
6. Emerging Technologies and Agricultural Structure .................. 123
7. Impacts of Agricultural Finance and Credit ........................ 137
8. Emerging Technologies, Public Policy, and Various Size Crop Farms .. 163
9. Emerging Technologies,. Public Policy, and Various Size Dairy Farms 189
10. Impacts on the Environment and Natural Resources................. 205
11. Impacts on Rural Communities ................................... 221
12. Impacts on Agricultural Research and Extension ................... 253
Part IV: Implications and Policy Options for Agriculture
13. Implications and Policy Options for Agriculture .................... 285
A: Animal and Plant Technology Workshop Methodology
and Procedures ............... ............................... 297
B: U.S. Regional Agricultural Sales by Sales Class and Commodity ....... 305
C: Participants in OTA W workshops ................................... 310
D: Analysis of Size Economies and Comparative Advantage in Crop
Production in Various Areas of the United States .................... 317
E: Methodology and Detailed Results of Microeconomic Impacts of Tech-
nology and Public Policy for Crop Farms ........................... 333
F: Detailed Results of Microeconomic Impacts of Technology and
Public Policy on Dairy Farms .................................... 348
G: Workgroups, Background Papers, and Acknowledgments ............. 358
In d ex ............................................................ 369

Chapter 1


Agricultural Dependency on World Markets ........................... 4
Emerging Technologies for Agriculture................................ 4
Biotechnology ......................... .... ........... .......... 4
Information Technology ........................................... 6
The Changing Structure of Agriculture ................................ 8
M ajor Findings .................................................... 10
Emerging Technologies and Future Agricultural Production ............ 10
Emerging Technologies and the Future Structure of Agriculture ........ 12
Impacts of Agricultural Finance and Credit .......................... 12
Emerging Technologies, Policy, and Survival of Various Size Farms ..... 14
Impacts on the Environment and Natural Resources .................. 15
Impacts on Rural Communities ..................................... 16
Impacts on Agricultural Research and Extension ..................... 18
Implications and Policy Options ...................................... 20
The Issue of Farm Structure ....................................... 20
Required Policy Adjustments ....................................... 21
Summary Conclusions .............................................. 25

Table No. Page
1-1. Distribution of Farm Sizes, Percent of Cash Receipts, Percent of Farm
Income, and Farm and Off-Farm Income by Sales Class, 1982 ........ 8
1-2. Most Likely Projection of Total Number of U.S. Farms in Year 2000,
by Sales Class ................................................. 9
1-3. Impact of Emerging Technology on Animal Production Efficiency
in Year 200 .................................................... 10
1-4 Impact of Emerging Technology on Crop Yields in Year 2000 ........ 11
1-5. Projections of M ajor Crop Production ............................. 11
1-6. Comparison of Commodities With Current Economies of Size and
Future Technological Gains ...................................... 14

Chapter 1


Over the next 15 years, American farmers will
be offered an extensive array of new biotech-
nologies and information technologies that
could revolutionize animal and plant produc-
tion. The adoption of these technologies will be
critical for shoring up the United States' lag-
ging ability to compete in the international mar-
ketplace. Indeed, 83 percent of the estimated
1.8-percent annual increase in agricultural pro-
duction needed to meet world agricultural de-
mand by year 2000 must come from increases
in agricultural yields, yields that can only be
possible through the development and adoption
of emerging technologies.
Yet if current agricultural policies remain in
force, this new biotechnology and information
technology era will also generate marked changes
in the structure of the agricultural sector and
of the rural communities that support farming.
Some of these changes are'already evident:
Farming is becoming more centralized, more
vertically integrated. Large farms, though small
in number, now produce most of this country's
agricultural output. Operators of small and
moderate-size farms, the so-called backbone of
American agriculture, are becoming increas-
ingly less able to compete, partly because they
lack access to the information and finances nec-
essary for adopting the new technologies effec-
tively. Many such farmers must relocate, change
to other kinds of farming, or give up farming
altogether. The disappearance of these farm
operations is causing repercussions for other
businesses in the rural community and for the
labor pool in general, which must absorb all
those whose livelihood once depended on agri-
cultural production.
This report is the first step toward understand-
ing the social and economic costs, as well as
the benefits, of the emerging technologies for
U.S. agriculture. It analyzes the dynamic forces

influencing change in the structure of agricul-
ture. Although technology was found to be an
important force in such change, it is only one
of several such forces. Public policy, institu-
tions, and economics have had and will con-
tinue to have important roles in shaping agricul-
ture. OTA analyzed the relationships between
all these factors, focusing on the 150 produc-
tion technologies that are likely to be available
commercially over the next 15 years. The study
results are presented in this report in four parts.
Part I identifies and analyzes the productive
capacity of those emerging technologies that
will help shape and define American agricul-
ture to the year 2000. Chapters 2 and 3 describe
the emerging technologies, discuss how they
will be used in agriculture, and analyze the im-
pact these technologies will have on animal and
plant agriculture.
Part II traces the historical changes in agri-
cultural structure. It provides a perspective for
analyzing technology's distributional impacts
on agricultural structure by surveying the char-
acteristics of that structure and the factors that
affect it.
How the emerging technologies, the policies,
and structural change relate to one another is
the subject of chapters 6 through 12 in part III.
The chapters analyze the results of this relation-
ship on: 1) future structure, 2) agricultural fi-
nance and credit, 3) survivability of crop and
dairy farms of various sizes, 4) environment,
5) rural communities, and 6) agricultural re-
search and extension.
Part IV draws the implications of the analy-
sis for policymakers. It shows the direction in
which agriculture is headed and concludes with
congressional policy options for improving the
picture of U.S. agriculture.

4 Technology, Public Policy, and the Changing Structure of American Agriculture


The financial condition of many American
farmers in the 1980s has significantly deterio-
rated during a long period of surpluses. The de-
cline in agricultural exports is largely respon-
sible for this situation. And although exports
are not this report's central focus, the future of
U.S. agricultural exports loom large in the back-
ground of this report.
Agricultural exports have historically been re-
sponsible for lessening the negative trade bal-
ance caused primarily by the manufacturing
and energy sectors. This importance of agricul-
ture to the balance of trade has increased sig-
nificantly over the past 30 years. However, the
past several years have witnessed a drop both
in the value of U.S. agricultural exports and in
agriculture's share of total U.S. exports.
Several key factors are causally related to re-
cent declines in U.S. agriculture:
1. a weak world economy,
2. the strong value of the dollar,
3. the enhanced competitiveness of other
4. an increase in trade agreements, and

5. price support levels that permit other coun-
tries to undersell the United States.
Although all of the factors are important, agri-
cultural experts are beginning to focus on the
lower costs of production in other countries as
the long-term primary factor in the decline of
this country's competitiveness. The United
States faces strong competition in wheat, corn,
rice, soybeans, and cotton. Each of these major
export commodities has been produced by at
least one country at or below the U.S. average
production costs since 1981. Estimates suggest
that any historic cost advantage that the United
States may have enjoyed in these commodities
is now tenuous.
Future exports will depend on the ability of
American farmers to use new technology to pro-
duce commodities more efficiently than com-
peting countries can. If the United States can-
not effectively compete with other countries in
the export market, reduced exports will mag-
nify the structural change and adjustment that
U.S. farmers and the rural communities will face
because of technological change.


Technology has made U.S. agriculture one of
the world's most productive and competitive
industries. Americans have already witnessed
the dramatic results of two major technologi-
cal eras in agriculture. The mechanical era of
1920 to 1950 allowed farmers to make the tran-
sition from horsepower to mechanical power
and greatly increased the productive capacity
of U.S. agriculture. The chemical era of 1950
to 1980 further increased agricultural produc-
tivity by increasing the farmers' ability to con-
trol pests and disease and by increasing the use
of chemical fertilizers. Now, in the 1980s, Amer-
ican agriculture is being propelled by a new ma-
jor technological thrust-the biotechnology and
information technology era. The effects of this
new era on agricultural productivity may be

more profound than those experienced from ei-
ther the mechanical or chemical eras.
Below is a brief summary of the technologies
examined for this study. A more complete de-
scription of the 150 technologies can be found
in chapter 2.

Biotechnology, broadly defined, includes any
technique that uses living organisms or proc-
esses to make or modify products, to improve
plants or animals, or to develop micro-orga-
nisms for specific uses. It focuses on two power-
ful molecular genetic techniques: recombinant
deoxyribonucleic acid (rDNA) and cell fusion

Ch. 1-Summary 5

technologies. Using these techniques scientists
can visualize the gene-to isolate, clone, and
study the structure of the gene and the gene's
relationships to the processes of living things.
Such knowledge and skills will give scientists
much greater control over biological systems,
leading to significant improvements in the pro-
duction of plants and animals.

Animal Agriculture
In animal agriculture, advances in protein
production, gene insertion, and embryo trans-
fer will play a major role in increasing efficien-
cies in animal production.
Production of Protein.-One major thrust of
biotechnology in animals is the mass produc-
tion in micro-organisms of protein-like pharma-
ceuticals, including a number of hormones, en-
zymes, activating factors, amino acids, and feed
supplements. Previously, these biological prod-
ucts could be obtained only from animal and
human organs and were either unavailable in
sufficient amounts or were too costly.
Some of these biological products canbe used
for detection, prevention, and treatment of in-
fectious and genetic diseases; some can be used
to increase animal production efficiency. One
of the applications of these new pharmaceuti-
cals is the injection of growth hormones into
animals to increase production efficiency. For
example, several firms are developing a geneti-
cally engineered bovine growth hormone to
stimulate lactation in cows. Trial results indi-
cate that cows treated with the hormone in-
crease milk production by 20 to 30 percent, with
only a modest increase in feed intake. Commer-
cial introduction of the new hormone awaits
approval by the U.S. Food and Drug Adminis-
tration, which is expected to approve the hor-
mone within the next 3 years.
In the area of disease prevention and treat-
ment, an immunological product currently ex-
ists on the market that prevents "scours" in
calves. In addition, vaccines producedby rDNA
methods are currently being tested for foot-and-
mouth disease, swine dysentery and, most re-
cently, coccidiosis in poultry.

Gene Insertion.-A new technique arising
from the convergence of gene and embryo ma-
nipulations promises to permit genes for new
traits to be inserted into the reproductive cells
of livestock and poultry, providing major oppor-
tunities to improve animal health and produc-
tivity. Unlike the genetically engineered hor-
mones discussed above, which cannot affect
future generations, gene insertion will allow fu-
ture animals to be endowed permanently with
traits of other animals. In this technique, genes
for a desired trait, such as disease resistance
or growth, are injected directly into either of
the two pronuclei of a fertilized egg. On fusion
of the pronuclei, the guest genes become part
of all the cells of the developing animal, and the
traits they determine are transmitted to succeed-
ing generations.
Embryo Transfer.-Embryo transfer, which
is closely related to gene insertion, involves arti-
ficially inseminating a super-ovulated donor
animal1 and removing the resulting embryos
nonsurgically for implantation in surrogate
mothers which then carry them to term. Prior
to implantation, the embryos can be treated in
a number of special ways. They can be sexed,
split (generally to make twins), fused with em-
bryos of other animal species (to make chimeric
animals or to permit the heterologous species
to carry the embryo to term), or frozen in liquid
nitrogen for storage. Freezing is of great prac-
tical importance because it allows embryos to
be stored until the estrus of the intended farm
animal is in synchrony with that of the donor.
Embryos used for gene insertions must be in
the single-cell stage, having pronuclei that can
be injected with cloned foreign genes. The genes
likely to be inserted into cattle may be those for
growth hormones, prolactins (lactation stimu-
lators), digestive enzymes, and interferons,
thereby providing both growth and enhanced
resistance to diseases.
Even though less than 1 percent of U.S. cattle
are involved in embryo transfers, the obvious

'An animal that has been injected with a hormone to stimulate
the production of more than the normal number of eggs per ovu-

6 Technology, Public Policy, and the Changing Structure of American Agriculture

benefits of this technology will push this per-
centage upward rapidly, particularly as the costs
of the procedure decrease. Recently, a genet-
ically superior Holstein cow and her 14 embryos
were purchased for $1.3 million.

Plant Agriculture
The application of biotechnologies in plant
agriculture could modify crops so that they
would make more nutritious protein, resist in-
sects and disease, grow in harsh environments,
and provide their own nitrogen fertilizer. While
the immediate impacts will be greater for ani-
mal agriculture, the long-term impacts of bio-
technology may be substantially greater for
plant agriculture. The potential applications of
biotechnology on plant agriculture include mi-
crobial inoculums, plant propagation, and ge-
netic modification.
Microbial Inocula.-Rhizobium seed inocula
already are used widely to improve the nitro-
gen fixation of certain legumes. Extensive study
of the structure and regulation of the genes in-
volved in bacterial nitrogen fixation will likely
lead to development of improved inocula. More-
over, research on other plant-colonizing mi-
crobes has led to a clearer understanding of the
role of these microbes in plant nutrition, growth
stimulation, and disease prevention, and the
possibility exists for the modification and use
of these microbes as seed inocula.
Monsanto has announced plans to field test
genetically engineered soil bacteria that pro-
duce a naturally occurring insecticide poten-
tially capable of protecting plant roots against
soil-dwelling insects. The company developed
a genetic engineering technique that inserts into
soil bacteria a gene from a micro-organism
known as Bacillus thuringiensis, a micro-orga-
nism that has been registered as an insecticide
for more than two decades. Plant seeds could
be coated with these bacteria before planting.
As the plants grow, the bacteria would remain
in the soil near the plant roots, generating an
insect toxin that protects the plants.
Plant Propagation.-Cell culture methods for
regeneration of intact plants from single cells
or tissue explants are now used routinely for

propagation of several vegetable, ornamental,
and tree species. These methods can provide
large numbers of genetically identical, disease-
free plants that often exhibit superior growth
and more uniformity over plants convention-
ally seed-grown. Such technology holds prom-
ise for breeding in important forest species
whose long sexual cycles reduce the impact of
traditional breeding approaches. Somatic em-
bryos2 produced in large quantities by cell cul-
ture methods can be encapsulated to create ar-
tificial seeds that may enhance propagation of
certain crop species.
Genetic Modification.-Plant genetic engi-
neering is the least established of the various
biotechnologies used in crop improvement, but
the most likely to have a major impact. Using
gene transfer techniques, it is possible to intro-
duce DNA from one plant into another plant,
regardless of normal species and sexual barriers.
For example, it is possible to introduce storage-
protein genes from French bean plants into
tobacco plants and to introduce genes that en-
code photosynthetic proteins in pea plants into
petunia plants.
Transformation technology also allows intro-
duction of DNA coding sequences from virtu-
ally any source into plants, providing those se-
quences are engineered with the appropriate
plant-gene regulatory signals. Several bacterial
genes have now been modified and shown to
function in plants. By eliminating sexual bar-
riers to gene transfer, genetic engineering will
greatly increase a plant's genetic diversity.

Information Technology
Animal Agriculture
Information technology is the use of comput-
er- and electronic-based technologies for the
automated collection, manipulation, and proc-
essing of information for control and manage-
ment of agricultural production and marketing.

The most significant changes in future livestock
production resulting from information technol-
ogy will come from the integration of computers

2Embryos produced from body cells rather than reproductive

Ch. 1-Summary 7

and electronics into modern livestock produc-
tion systems that will help make the farmer a
better manager. Animal identification, animal
reproduction, and disease control and preven-
tion are some promising areas for information
technology in livestock production.
Electronic Animal Identification.-Positive
identification of animals is necessary in all
facets of management, including recordkeep-
ing, individualized feed control, genetic im-
provement, and disease control. Research on
identification systems for animals has been in
progress for some years. Soon, all farm animals
will be "tagged" shortly after birth by an elec-
tronic device, called a transponder, that lasts
the life of the animal. For example, some dairy
cows now wear a transponder in the ear or on
a neck chain. A feed-dispensing device identi-
fies the animal by the transponder's signal and
provides an appropriate amount of feed for the
Reproduction.-The largest potential use of
electronic devices in livestock production will
be in the area of reproduction and genetic im-
provement. An inexpensive estrus detection de-
vice will allow: 1) animals to be rebred faster
after weaning; 2) animals that did not breed to
be culled from the herd, saving on feeding and
breeding space; 3) time to be saved because
breeding can be done faster; and 4) easier em-
bryo transplants because of improved estrus de-
Disease Control and Prevention.-Herd rec-
ordkeeping systems for animal health are al-
ready being developed and refined in the dairy,
swine, and poultry industries. These record-
keeping systems will eventually be linked with
the animal identification systems discussed
above. Examples of the types of information that
can be recorded for each animal include pro-
duction records, feed consumption, vaccination
profiles, breeding records, conception dates,
number of offspring, listing and dates of dis-
eases, and costs of medicines for treatment or
prevention of disease. Bringing all this infor-
mation together will allow the veterinarian and
a manager of the livestock enterprise to analyze
quickly a health profile for each animal and to

plan for improved efficiency in disease control

Plant Agriculture
Pest Management.-Infqrmation technology
is already being used in plant agriculture for
the management of insects and mites. Design
improvements and availability of computer
hardware and software will produce marked
changes in insect and mite management.
Availability at the farm level of microcom-
puters, equipped with appropriate software and
having access to larger centralized databases,
will accelerate transfer of information and fa-
cilitate pest management decisionmaking. The
advantages, simply in terms of information stor-
age and retrieval, will be of major importance.
The ready storage of and access to current and
historical information on pest biology, inci-
dence, and abundance; pesticide use; cropping
histories; weather; and the like at the regional,
farm, and even field level will facilitate selec-
tion of the appropriate management unit and
the design and implementation of pest manage-
ment strategies for that unit.
Current software has already greatly improved
the efficiency and accuracy with which pest
management decisions can be made and imple-
mented. Much effort is being devoted to the
development of new software and the improve-
ment of existing software. The resultant prod-
ucts, in conjunction with the rapid advances
being made in computer hardware, will provide
a powerful force that will lead to dramatic
changes in the implementation of integrated
pest management (IPM) and to increases in the
level of sophistication of IPM.
Irrigation Control Systems.-Because irriga-
tion decisions are complex and require relative-
ly large amounts of information, a microcom-
puter-based irrigation monitoring and control
system is especially useful in areas with soils
having variable percolation and retention rates,
where rainfall is especially variable, or where
the salinity of irrigation water changes unpre-
dictably. In this system, a network of sensors,
with radio links to the central processor, is

8 Technology, Public Policy, and the Changing Structure of American Agriculture

buried in irrigated fields. Additional sensors
may include weather station sensors to estimate
crop stress and evaporation rates, salinity sen-
sors, and runoff sensors. The central proces-
sor uses such information to allocate water auto-
matically according to crop needs in each field,
subject to considerations of cost, leaching re-
quirements, and availability of water.
Radar, Sensors, and Computers.-Through
the use of radar, sensors, and computers the cor-
rect amount of fertilizer, pesticides, and plant
growth regulators can be applied to plants by
integrating tractor slippage and chemical flow.
The correct rate of application of most agricul-
tural chemicals is usually within a narrow range
for a given crop and field. However, applica-
tion rates are often variable from area to area
within a field, owing to changes in the flow rate

of chemical slurries and to changes in tractor
wheel slip, grading, and drawbar tension. Eco-
nomic and environmental costs are associated
with applications of too little or too much chem-
icals. Control of application rate depends on the
ability to estimate rate of flow through the chem-
ical sprayer and on the vehicle's speed over the
field. The speed indicated by sensors in the trac-
tor drivetrain is usually greater than the actual
speed over the ground, owing to slippage of the
drive wheels. The amount of slippage can be
monitored by a doppler radar device that com-
pares actual speed to indicated speed in the
drivetrain. When all this information is avail-
able, a computer can then adjust the spray line
pressure to deliver the correct amount of chem-
icals at varying speeds and amounts of wheel


Agriculture is entering a new technological
era at a time when the character of agriculture
is changing rapidly. Emerging biotechnologies
and information technologies will be introduced
within a socioeconomic structure that has un-
dergone considerable change in the last 50 years
and that promises to continue to change through-
out the remainder of this century.

One of the best ways to look at changes in the
economic structure of U.S. agriculture is in
terms of value of production as measured by
gross sales per year. In this way farms can be

usefully classified into five categories of gross
sales, as shown in table 1-1.
Small and part-time farms generally do not
provide a significant source of income to their
operators. Most of these farmers obtain their
primary net income from off-farm sources.
However, this segment is highly diverse. This
class of farms is operated either by subsistence
farmers or by individuals who use the farm as
either a tax shelter or a source of recreation.
Moderate-size farms cover the lower end of
the range in which the farm is large enough to

Table 1-1.-Distribution of Farm Sizes, Percent of Cash Receipts, Percent of Farm Income, and
Farm and Off-Farm Income per Farm by Sales Class, 1982

Value of farm
Sales class products sold
Small ......... < $20,000
Part-time...... $20,000-$99,000
Moderate...... $100,000-$199,000
Large ......... $200,000-$499,000
Very large ..... $500,000
All farms .....

of farms

of all

Percent of
total cash

Percent of Average
net farm net farm
income income
-3.8 (615)
5.4 998
14.6 17,810
20.4 48,095
63.5 504,832
100 $9,976



SOURCE: Compiled from Economic Indicators of the Farm Sector: Income and Balance Sheet Statistics, 1983, USDA Economic Research Service, 1984, table 59, using
farm number and cash receipts distribution from the 1982 Census of Agriculture, U.S. Department of Commerce, Bureau of the Census, 1984.

Ch. 1-Summary 9

be the primary source of income. However, most of net farm income. The agricultural sector can
families with farms in this range also rely on be described as a bipolar, or dual sector: As the
off-farm income. moderate-size farm disappears, it leaves small
Large and very large farms include a diverse and part-time farms clustered at one end of the
range of farms. The great majority of these farms farming spectrum and large farms clustered at
are family owned and operated. Most require the other, in terms of their importance to agri-
one or more full-time operators, and many de- culture.
pend on hired labor full time. The degree of con- If present trends continue to the end of this
tracing (monitoring and controlling production century, the total number of farms will continue
to produce a specified quantity of homogene- to decline from 2.2 million in 1982 to 1.2 mil-
ous products for a buyer) and vertical integra- lion in 2000 (table 1-2). The number of small and
tion is much higher in this class, part-time farms will continue to decline, but will
To appreciate how agriculture has changed still make up about 80 percent of total farms.
t eteen 1 an conier te o- The large and very large farms will increase sub-
just between 1969 and 1982, consider the fol-
lowing: stantially in number. Approximately 50,000 of
these largest farms will account for 75 percent
The number of small farms declined 39 per- of the agricultural production by year 2000. The
cent, while the number of very large farms trend toward concentration of agricultural re-
increased by 100 percent. sources into fewer but larger farms will con-
The share of cash receipts from very large tinue, although the degree of concentration will
farms increased slightly, from 29 to 33 per- vary by region and commodity.
cent, while cash receipts declined from 40 Me f w d i
to25percentforsmallandpart-timefarms. Moderate-size farms will decline in number
to 25 percent for small and part-time farms. and in proportion of total farms, have a small
The share of net farm income declined sig- and in proportion f total farms, have a small
nificantly (from 36 to 5 percent) for small share of the market and a declining share of net
and part-time farms, and increased from farm income. These farms comprise most of the
farms that depend on agriculture for the ma-
36 to 64 percent for very large farmsjority of their income. Traditionally, the mod-
These trends indicate that small and part-time erate-size farm has been viewed as the backbone
farms no longer can depend on the farm to pro- of American agriculture. These farms are fail-
vide an adequate income. Large-scale farms ing in their efforts to compete for their histori-
dominate agriculture. Moderate-size farms have cal share of farm income.
a small share of the market and a stagnant share

Table 1-2.-Most Likely Projection of Total Number of U.S. Farms
in Year 2000, by Sales Class

Sales class
Small and part-time..........
Large and very large ........
Total ...................
SOURCE: Office of Technology Assessment.

of farms Percent of
(thousands) all farms
1,936.9 86.0
180.7 10.0
121.7 4.0
2,239.3 100.0

of farms Percent of
(thousands) all farms
1,000.2 80.0
75.0 6.0
175.0 14.0
1,250.2 100.0

10 Technology, Public Policy, and the Changing Structure of American Agriculture


Emerging Technologies and Future
Agricultural Production
Like the eras that preceded it, the biotechnol-
ogy and information technology era will bring
technologies that can significantly increase agri-
cultural yields. The immediate impacts of these
technologies willbe felt first in animal produc-
tion. Through embryo transfers, gene insertion,
growth hormones, and other genetic engineer-
ing techniques, dairy cows will produce more
milk per cow, and cattle, swine, sheep, and poul-
try will produce more meat per pound of feed.
Impacts on plant production will take longer,
almost the remainder of the century. By that
time, however, technical advances will allow
some major crops to be altered genetically for
disease and insect resistance, higher produc-
tion of protein, and self-production of fertilizer
and herbicide.
In both plant and animal production, informa-
tion technologies will be widely used on farms
to increase management efficiency. Introduc-
ing to the marketplace these and the rest of the
150 emerging technologies forecasted in this
study raises questions about the effects these
technologies will have on crop yield, livestock
feed efficiency, reproductive efficiency, and fu-
ture food production.
Many people are concerned that the trends
of major crop yields are leveling off and that
the world may not be able to continue to pro-
duce enough food to meet the demand of a grow-
ing population. OTA analyses indicate that the
emerging technologies, if fully adopted, will pro-
duce significant beneficial impacts on the per-
formance of plant and animal agriculture. The
most dramatic impacts will be felt first in the
dairy industry, where new genetically engi-
neered pharmaceuticals (such as bovine growth
hormone and feed additives) and information
management systems will soon be introduced
commercially. New technologies adopted by the
dairy industry will increase milk production far
beyond the 2.6-percent annual growth rate of
the past 20 years (table 1-3). Under OTA's most

Table 1-3.-Impact of Emerging Technology on Animal
Production Efficiency in Year 2000
Most Annual
Actual likely growth rate
1982 2000 (percent)
Pounds meat per Ib feed .... 0.07 0.072 0.2
Calves per cow ............. 0.88 1.000 0.7
Pounds milk per Ib feed ..... 0.99 1.03 0.2
Milk per cow per year
(1,000 Ib)................. 12.30 24.70 3.9
Pounds meat per Ib feed .... 0.40 0.57 2.0
Eggs per layer per year...... 243.00 275.00 0.7
Pounds meat per Ib feed .... 0.157 0.176 0.6
Pigs per sow per year ....... 14.400 17.400 1.1
aSome of these figures differ from those in table 2-2 of the first report from this
study, because actual 1982 figures were preliminary.
SOURCE: Office of Technology Assessment.

likely conditions, milk production per cow is
expected to increase from the 12,000 pounds
in 1982 to at least 24,000 pounds by 2000, an
annual growth rate of 3.9 percent. Applications
of new technologies also will increase the feed
and reproductive efficiency of other farm animals.
Because development of biotechnology for
plant agriculture is lagging behind that for
animal agriculture, equally significant impacts
from biotechnology will not be felt in plant agri-
culture before the turn of the century. Develop-
ment and adoption of the new technologies un-
der the most likely conditions will, in the short
run, increase the rates of growth of major crop
yields at about the level of historical rates of
growth (table 1-4). However, the impacts of these
technologies will be substantially greater for
plant agriculture after 2000.
Any conclusion about the balance of global
supply and demand requires many assumptions
about the quantity and quality of resources avail-
able to agriculture in the future. Land, water,
and technology will be the limiting factors as
far as agriculture's future productivity is con-
Agricultural land that does not require irri-
gation is becoming an increasingly limited re-

Ch. 1-Summary 11

Table 1-4.-Impact of Emerging Technology on
Crop Yields in Year 2000
Actual Most likely growth rate
1982 2000 (percent)
Corn-bu/acre ....... 113 139 1.2
Cotton-Iblacre ...... 481 554 0.7
Rice-bu/acre........ 105 124 0.9
Soybean-bu/acre .... 30 37 1.2
Wheat-bulacre ...... 36 45 1.3
aSome of these figures differ from those in table 2-2 of the first report from this
study, because actual 1982 figures were preliminary.
SOURCE: Office of Technology Assessment.

source. In the next 20 years, out of a predicted
1.8 percent annual increase in production to
meet world demand, only 0.3 percent will come
from an increase in the quantity of land used
in production. The other 1.5 percent will have
to come from increases in yields-mainly from
new technology. Thus, to a very large extent,
research that produces new technologies will
determine the future world supply/demand bal-
ance and the amount of pressure placed on the
world's limited resources.
Table 1-5 shows the projections to year 2000
of increased production for some of the major
U.S. commodities, based on the above yield pro-
jections, land availability, world demand, public
policy, and other factors. OTA analyses indi-
cate that with continuous inflow of new tech-
nologies into the agricultural production sys-
tem, U.S. agriculture will be able not only to
meet domestic demand, but also to contribute
significantly to meeting world demand in the

next 20 years. This does not necessarily mean
that the United States will be competitive or have
the economic incentive to produce. It means
only that the United States will have the tech-
nology available to provide the production in-
creases needed to export products for the rest
of this century.
Under the most likely environment,3 the ag-
gregate growth rate in production of these com-
modities, which includes inputs of additional
land resources and new technology, will be ade-
quate to meet the 1.8 percent growth rate needed
to balance world supply and demand in 2000.
Under the more-new-technology environment,4
production could increase at 2 percent per year,
which would be more than enough to meet world
demand. This increased production could, how-
ever, point to a future of surplus production.
On the other hand, under the less-new-technol-
ogy environment5 the production of major crops
in 2000 would drop to 1.6 percent per year, a
growth rate that would not allow the United
States to meet world demand.

3Assumes to year 2000: 1) a real rate of growth in research and
extension expenditures of 2 percent per year, and 2) the continu-
ation of all other forces that have shaped past development and
adoption of technology.
4Assumes to year 2000: 1) a real rate of growth in research and
extension expenditures of 4 percent, and 2) all other factors more
favorable than those of the most likely environment.
5Assumes to year 2000: 1) no real rate of growth in research
and extension expenditures, and 2) all other factors less favora-
ble than those of the most likely environment.

Table 1-5.-Projections of Major Crop Productiona

No-new-technology Most likely More-new-technology
Crop Unit 1984 environment environment environment
Production ....... Billion bu 7.7 8.6 9.3 9.7
Growth rate....... Percent 0.7 1.2 1.5
Production ....... Billion bu 1.9 3.0 3.2 3.3
Growth rate....... Percent 3.1 3.4 3.6
Production ....... Billion bu 2.6 3.3 3.5 3.5
Growth rate....... Percent 1.5 1.9 2.0
aThe projections shown in this table differ from those in table 2-3 of the first report from this study, because the previous
figures were preliminary.
SOURCE: Office of Technology Assessment.

12 Technology, Public Policy, and the Changing Structure of American Agriculture

Emerging Technologies and the
Future Structure of Agriculture
New technologies have historically had sig-
nificant impacts on structural change. New dis-
ease control technologies gave poultry and live-
stock farmers unprecedented opportunities to
specialize and vertically integrate. Improve-
ments in farm machinery fostered large-scale,
specialized farm units.
Like their predecessors, the emerging technol-
ogies examined in this study will make a con-
siderable impact on farm structure, especially
by 2000. Biotechnologies will have the greatest
impact because they will enable agricultural
production to become more centralized and ver-
tically integrated. Although in the long run the
use of new technologies will not increase the
farmer's overall need for capital, there will be
trade-offs: biotechnology will require less cap-
ital; information technology will require more.
The new technologies will allow increased
control over end-product characteristics, for ex-
ample less fat per unit of lean in meat animals
or a specific color characteristic in corn. This
implies that increased homogeneity within an
agricultural product may result and that there
will be a growing number of end products with
engineered characteristics. This would require
less sorting or grading to achieve increased
homogeneity and a shift toward having more
control over the production process so as to
achieve homogeneity during production.
An anticipated economic consequence of this
increased control over production is an increase
in the practice of contracting. Contracting al-
lows husbandry and cultural practices to be
monitored and controlled closely during the pro-
duction process. This greater process control
leads to uniform product differentiation.
Biotechnologies will have relatively more im-
portant effects on resource concentration than
will other technological developments. Even
though mechanical technologies will continue
to be important, they are not expected to have
as important an impact on future structure. In
particular, biotechnologies are expected to en-
courage closer coordination and greater proc-
ess control in livestock production, permitting

more contract livestock production. One exam-
ple is the potential from these technologies for
modifying milk at the farm rather than at the
processing plant. This technology holds prom-
ise for producing more highly unsaturated fats
in milk. If adopted, it would entail close coordi-
nation at the producer/first-handler markets and
additional process control at the production
The biological technologies will encourage
coordination in crop production, as well. How-
ever, the magnitude of change in this area is
expected to be relatively less for crops than live-
stock. Part of the reason is that biotechnologies
for livestock production are further advanced.
The biotechnology era is expected to encourage
closer vertical coordination, with a slight reduc-
tion in market access as a consequence. This
situation would subsequently lead to fewer but
larger farms.
The information technologies are expected
to reduce barriers to entry and to increase mar-
ket access without any significant change in ver-
tical coordination or control at the producer/
first-handler level-especially for crop agricul-
ture. Information technologies hold the poten-
tial for significantly increasing the amount of
information across markets. This impact would
be attributable to improved communication of
buyers' needs to production-level managers,
which should result in more equality between
buyers and sellers.
The largest farms are expected to adopt the
greatest amount of the new technologies. Gen-
erally, 70 percent or more of the largest farms
are expected to adopt some of the biotechnol-
ogies and information technologies. This con-
trasts with only 40 percent for moderate-size
farms and about 10 percent for the small farms.
The economic advantages from the technologies
are expected to accrue to early adopters, a large
proportion of which will probably be operators
of large farms.

Impacts of Agricultural
Finance and Credit
The severe financial stress of a large propor-
tion of farmers and the recent regulatory and

Ch. 1-Summary 13

competitive changes in financial markets have
combined to change significantly the financial
framework of farming. The farm of the future
will be treated financially like any other busi-
ness-it will have to demonstrate profitability
before a bank will finance its operation. Man-
aging a farm efficiently and profitably, which
will necessitate keeping up-to-date technologi-
cally, will be the key to access to credit.
The cost of credit, however, will be higher and
more volatile. Interest on loans may be varia-
ble rather than fixed. Moreover, given the con-
centration in the banking industry, decisions
about extending credit more likely will be made
at large, centralized banking headquarters far
removed from a loan applicant's farm. Loan de-
cisions will thus be less influenced by the con-
siderations of neighborly good will that fre-
quently shaded decisions of local farm banks.
Congress will have to consider all these fac-
tors because the availability of capital will con-
tinue to be an important factor in agricultural
production in general and in the adoption of
agricultural technologies in particular. Read-
ily available capital at reasonable rates and
terms, plus technologies that aid profitability,
provide a favorable environment for technol-
ogy adoption. Emerging technologies, for the
most part, will pass the test for economic feasi-
The financing consequences of new technol-
ogies in agricultural production will probably
depend on the relationships between three im-
portant factors: 1) the financing characteristics
of the new technologies, 2) the creditworthiness
of individual borrowers, and 3) the changing
forces in financial markets that affect the cost
and availability of financial capital. The financ-
ing characteristics suggest that most of the new
technologies should be financed largely with
short- and intermediate-term loans that are part
of the normal financing procedures for agricul-
tural businesses. However, the technical char-
acteristics of the technologies, together with the
factors constituting the creditworthiness of in-
dividual borrowers, suggest that increased em-
phasis in credit evaluations will be placed on
the farmers' management capacity, on their abil-
ity to demonstrate appropriate technical com-

petence in using the new technologies, and on
building human capital, where appropriate. In
some cases-particularly for Farmers Home Ad-
minstration borrowers-significant invest-
ments in human capital, with related financing
requirements, may accompany new technology
adoption. This is consistent with the more con-
servative responses by lenders to the agricul-
tural stress conditions of the early 1980s. Lend-
ing institutions themselves, in turn, must have
sufficient technical knowledge and expertise to
evaluate these management and credit factors
along with other sources of business and finan-
cial risks in agriculture. Finally, some forms of
new technology involving large investments and
having long-run uncertain returns will probably
rely more on equity capital for financing.
The changing regulatory and competitive
forces in financial markets, including the prefer-
ence for greater privatization of some credit in-
stitutions, means that the cost of borrowing for
agricultural producers will likely remain higher
and more volatile than before 1980 times and
will follow market interest rates much more
closely. Similarly, the continued geographic lib-
eralization of banking and the emergence of
more complex financial systems mean that the
functions of marketing financial services, loan
servicing, and credit decisions will become
more distinct, with an increasing proportion of
credit control and loan authority occurring sub-
regionally and with regional money centers be-
ing located away from the rural areas. This will
continue to fragment and dichotomize the farm-
credit market so that commercial-scale agricul-
tural borrowers will be treated as part of a fi-
nancial institution's commercial lending activ-
ities and small, part-time farmers will be treated
as part of consumer lending programs.
The competitive pressures on financial insti-
tutions and the risks involved will bring more
emphasis on analyzing the profitability of vari-
ous banking functions, including loan perform-
ance at the department level and individual cus-
tomer level. Innovative lenders will strive more
vigorously to differentiate their loan products
and financial services, especially for more prof-
itable borrowers, and will tailor financing pro-
grams more precisely to the specific needs of

14 Technology, Public Policy, and the Changing Structure of American Agriculture

creditworthy borrowers. In turn, however, to
compete for credit services these agricultural
borrowers must be highly skilled in the techni-
cal aspects of agricultural production and mar-
keting as well as in financial accounting, finan-
cial management, and risk analysis.
In general, most forms of new technology in
agricultural production should meet the tests
of both economic and financial feasibility, al-
though the structural characteristics of the
adopting farm units will continue to evolve in
response to managerial, economic, and market
factors. The structural consequences of these
factors are severalfold:
1. a continuing push toward larger commer-
cial-scale farm businesses, with greater skills
in all aspects of business management;
2. continuing evolution in the methods of en-
try into agriculture by young or new farm-
ers, with greater emphasis on management
skills and resource control and less empha-
sis on land ownership;
3. the continuing development of a market-
ing systems approach toward financing
agriculture, with more sophisticated skills
in marketing analysis by farmers and higher
degrees of coordination with commodity
and resource markets;
4. more formal management of financial lev-
erage and credit by farmers, with greater
diversity of funding sources by farmers and
better developed markets for obtaining out-
side equity capital;
5. further development in financial leasing
and greater stability in leasing arrange-
ments for real estate and other assets; and
6. more complex business arrangements in
production agriculture that accommodate
various ways to package effectively debt
and equity financing, leasing, management,
accounting, and legal services for the fu-
ture farm business.

Emerging Tecmhologies, Policy, and
Survival of Various Size Farms

The size and, therefore, the survival of farms
is affectedby several factors. Clearly, there are
economies of size in many commodity areas

covered by farm policy. These economies moti-
vate further concentration of resources. In addi-
tion, present farm policy, more than any other
policy tool, makes major impacts on farm size
and survival. Although very large farms can sur-
vive without these programs, moderate-size
farms depend on them for their survival.
This study finds that substantial economies
of size exist for several major commodities (table
1-6). The commodities include dairy, corn, cot-
ton, wheat, and soybeans. With the exception
of corn, economies of size do not exist uniformly
in all the production areas studied for these com-
modities. Table 1-6 shows the areas in which
economies of size do exist. It should be noted
that the analysis considered only technical econ-
omies of size. If it had also included pecuniary
economies, additional production areas would
have been found to have economies of size.
Table 1-6 also shows commodities in which
there will be significant gains in yield based on
emerging technologies. All of the commodity
areas except rice will experience substantial
gains in yield as well as significant economies
of size. (No economies of size were found for

Table 1.6.-Comparison of Commodities With Current
Economies of Size and Future Technological Gains

Current economies of size
(in descending order)
New Mexico
SOURCE: Office of Technology Assessment.

Greatest yield increases
for the future
(in descending order)

Ch. 1-Summary 15

rice.) Dairy, in particular, leads all commodi-
ties in economies of size and production in-
creases from new technologies. These forces
will combine to shift over time the comparative
advantage in dairy production from the smaller
dairies in the Great Lake States and Northeast
to the larger dairies in the Southwest and West.
Overall, the combination of future yield in-
creases from new technology and current econ-
omies of size in these commodities means that
there will be substantial incentives for farms
to grow in size. These powerful forces will con-
tinue, and may even speed up resource concen-
tration in U.S. agriculture.
This study finds that farm programs, which
include Commodity Credit Corporation (CCC)
purchases and price and income supports, have
major impacts on rates of growth in farm size,
wealth, and incomes of commercial farmers.
Large farms increase their net worth signifi-
cantly more than moderate-size farms under
current farm programs and large farms account
for a significantly large share of farm program
payments. In particular, price supports provide
most of the wealth and growth benefits to large
Removing farm programs reduces the prob-
ability of survival more for moderate-size farms
than for large farms. OTA's analyses find that
large farms can survive and prosper without
farm programs. And, because these farms ac-
count for the vast majority of farm program ben-
efits, significant savings in Government expend-
itures could be realized if large farms were
ineligible to receive program payments.
On the other hand, this study finds that mod-
erate farms need farm programs to survive and
be successful. Income supports, in particular,
provide significant benefits to moderate farms,
and the targeting of income supports to moder-
ate farms is an effective policy tool for prolong-
ing these farms' survival.
Those changes in tax policy that would be
more restrictive have little impact on farm sur-
vival. Increasing the Federal tax burden on
farmers reduces the average annual rate of
growth in farm size uniformly for all farm sizes.

Currently the financial position of many
farmers is under severe stress. The situation is
serious and may not improve for some time.
Two alternatives most discussed by policy-
makers are interest subsidy and debt restruc-
turing programs. OTA finds that restructuring
debt for highly leveraged farms does not ap-
preciably increase their probability for survival.
The interest rate subsidy substantially increases
average net income more than debt restructur-
ing. It is the more effective strategy to ease fi-
nancial stress. In addition, large farms with high
debts are not as dependent on these financial
programs for survival as moderate farms are.

Impacts on the Environment and
Natural Resources
In general, with a few notable exceptions,
most emerging technologies are expected to re-
duce substantially the land and water require-
ments for meeting future agricultural needs.
Consequently, these technologies are expected
to reduce certain environmental problems asso-
ciated with the use of land and water. The tech-
nologies are thought to have beneficial effects
relative to soil erosion, to reduce threats to wild-
life habitat, and to reduce dangers associated
with the use of agricultural chemicals. New till-
age technologies, however, may reduce erosion
and threats to wildlife while increasing the
dangers from the use of agricultural chemicals.
The new technologies are most likely to re-
ceive first adoption by farmers who are well
financed and are capable of providing the so-
phisticated management required to make prof-
itable use of the technologies. Most of these
farmers will be associated with relatively large
operations. Hence, the technologies will tend
to give additional economic advantages to large
farm firms relative to moderate and smaller
farms, accentuating the trend toward a dual
farm structure in the United States.
In addition, since many of the new technol-
ogies tend to be environmentally enhancing,
public interest exists in research and education
that can lead to the rapid development and wide-
spread adoption of the technologies. That con-

16 Technology, Public Policy, and the Changing Structure of American Agriculture

clusion becomes even stronger if public policy
is aimed at maintenance of the moderate-size
farm. Larger farms, with their own access to
research results and scientific expertise, may
be able to advance the new technologies with
relatively little publicly sponsored research. But
moderate and small farms will have to depend
on publicly sponsored research and extension
education to gain access to the new technologies
and to adapt them to their individual needs.
The new technologies will entail more strin-
gent environmental regulations and stronger en-
forcement of regulations than at present. The
complexities of some of the emerging technol-
ogies will pose significant challenges for those
promulgating wise environmental regulations.
The economic benefits of the technologies will
be inviting, but users may have little incentive
to use the technologies in ways that avoid un-
necessary, adverse, third-party effects. Eco-
nomic incentives or disincentives, including the
use of excise taxes to discourage overuse of
potentially threatening materials, represent a
promising approach to the protection of envi-
ronmental values than do direct regulation. Ad-
ditional efforts to enforce existing regulations
would hasten the adoption of the new technol-
ogies that seem less environmentally threaten-
ing. New regulations will be required, however,
for dealing with some aspects of the emerging
Perhaps the most revolutionary of the new
technologies are those associated with rDNA.
While the specific applications of such technol-
ogies appear likely to reduce resource needs and
threats to the environment that arise from agri-
cultural activities, dangers may accompany the
deliberate release of genetically altered micro-
organisms. The revolutionary nature of the new
biotechnologies and the lack of a scientifically
accepted predictive ecology prevent specific
evaluation of resource/environmental impacts
associated with the deliberate release of new
forms of life at this time.
Many scientists see little danger in the appli-
cations of rDNA technology in laboratory ex-
periments. The proponents of biotechnology ar-
gue that genetic engineering has been used in

plant breeding and animal husbandry for cen-
turies and that genetically engineered micro-
oganisms are no more dangerous than micro-
organisms already in commercial use or that
might be used in nature. However, the oppo-
nents of deliberate release argue that the new
products of genetic engineering are different
from the old ones. Scientists do not know how
these new micro-organisms will behave in the
environment and fear adverse consequences to
the ecosystem. Both sides agree that more re-
search should be conducted to assess the po-
tential benefits and risks. Recently, the Envi-
ronmental Protection Agency approved the first
two field tests of genetically altered organisms.

Impacts on Rural Communities
The impacts of technological and structural
change in agriculture do not end with the indi-
viduals who live and work on farms. A variety
of additional consequences are expected at the
level of rural communities, consequences that
directly or indirectly affect farms and farmers.
As with individual farmers, some communities
are likely to benefit from change, while others
are likely to be affected adversely. Much de-
pends on the type of overall labor force in the
community and on the opportunities for labor
to move to other employment areas.
Hard-hit communities may need technical
assistance to attract new businesses to their
areas, to develop labor retraining programs, and
to alter community infrastructure to attract new
inhabitants. To accomplish these goals, Federal
policy will have to be complemented by regional
and local policies.
Those rural communities that benefit from
changes in agricultural technology and struc-
ture may do so in several ways. For example,
as agriculture becomes more concentrated,
some communities will emerge as areawide
centers for the provision of new, high-value tech-
nical services and products. Likewise, some
communities will emerge as centers for high-
volume food packaging, processing, and distri-
bution. Inboth cases, the economic base of these
communities is likely to expand. However, un-

Ch. 1-Summary 17

less total demand for agricultural commodities
increases substantially, centralization of serv-
ices, marketing, and processing will be like a
zero-sum game in many areas. The market cen-
ters will benefit at the expense of other com-
munities. Many of the communities that are by-
passed will decline as a result of the process of
Communities also may benefit in those parts
of the country in which the number of small and
part-time farms is increasing. This phenome-
non results in an increase in population in many
rural areas and an increase in total income and
spending in some of these areas. The increase
in small farms may sustain additional retail es-
tablishments than would otherwise be the case,
since purchases by small farmers may tend to
be more from local sources than those by larger
farmers. The operators of these farms in many
cases subsidize their own production from off-
farm income.
A wide range of diversity is evident in the
character, agricultural structure, patterns of
change, and patterns of impact on rural com-
munities in the five different regions of the
United States studied for this report:
1. the CATF (California, Arizona, Texas, and
Florida) region;
2. the South;
3. the Northeast;
4. the Midwest; and
5. the Great Plains and the West.
A clear picture of adverse relationships be-
tween agricultural structure and the welfare of
rural communities is evident in the industrial-
agricultural counties of the CATF region. Large-
scale and very large-scale industrialized agri-
culture in these communities is strongly asso-
ciated with high rates of poverty, substandard
housing, and exploitative labor practices in the
rural communities that provide hired labor for
these farms. Very large-scale agriculture has
been a strong source of employment in the CATF
region for many years, although at very low
wage rates. Emerging technologies may reduce
the labor requirements throughout much of the
CATF region by 2000. Increased unemployment
will greatly increase the strain on these com-

munities. A potential exists for the CATF re-
gion to increase its share of national agricultural
production, which would mitigate the trend
toward increasing unemployment. However, in-
creased agricultural production in this region
will tend to be constrained by the cost of irriga-
tion water and the need to control environ-
mental impacts.
The coastal zone of the South also has a sub-
stantial potential for structural change similar
to that of the CATF region. Topography and cli-
mate favor large-scale, labor-intensive produc-
tion of fruits, vegetables, and dairy products.
The area also has a segmented, relatively un-
skilled labor force that could provide a source
of low-cost labor similar to that of the CATF
region. It is difficult to generalize about the rest
of the South, owing to the diversity of agricul-
tural structure and production. Evidence exists
of a relatively strong association between rates
of unemployment and agricultural structure.
Unemployment rates tend to be lowest in coun-
ties with a predominance of moderate farms.
In the Northeast, dairy products are the single
most important agricultural commodity group.
Because dairy farms are likely to experience
widespread failure as a consequence of the com-
bination of technological change and public pol-
icies, the structure of agriculture in the North-
east is likely to change substantially during the
next 10 to 15 years. However, rural communi-
ties in the Northeast have a low overall depen-
dence on income from agriculture. Most pro-
ductive agricultural counties in the Northeast
are adjacent to metropolitan areas where greater
employment opportunities and services are
available. The most rural counties sometimes
are not the most agricultural. Therefore, rural
communities in the Northeast generally are not
likely to experience adverse consequences from
structural change, with the exception of a few
localities with especially high dependence on
dairy production.
No clear-cut evidence exists that rural com-
munities in the Midwest were adversely affected
by structural change during the 1970s. In gen-
eral, alternative sources of employment in the
manufacturing and service sectors were rela-

18 Technology, Public Policy, and the Changing Structure of American Agriculture

tively prevalent and are expected to continue
to be relatively good in the Midwest. Indicators
of social welfare, in general, tended to improve
as farm structure moved from small and part-
time farms toward moderate to large farms dur-
ing the 1970s. However, there was a tendency
for population to decline in counties where the
share of part-ownership of farms increased. As
with the Northeast region, there is a reasonable
expectation that technological change in the
dairy industry will result in a mass exodus of
small to moderate dairy farms during the next
5 to 15 years. Rural communities in dairy coun-
ties may not be adversely affected because off-
farm employment is quite high in these coun-
ties. Those mixed agricultural counties on the
western edge of the Midwest that are relatively
dependent on agriculture are the most likely to
suffer adverse consequences from structural
change. If the percent of part-ownership in-
creases as agriculture becomes more concen-
trated, population, median income, and retail
sales may decline in these counties.

Strong potential exists for development of a
high concentration of agricultural production
in the Great Plains and the West, especially in
terms of farm size, if not gross sales per farm.
In turn, the number and percent of hired man-
agers in this region is likely to increase. Unlike
the South, there is a low potential for develop-
ment of an industrialized agriculture with large
numbers of hired field workers. The most likely
adverse impact will be the loss of population
and small retail firms in the region. In general,
fewer alternate employment options will be
likely in manufacturing and the service indus-
tries in this region than in the other regions of
the country.

This study shows clearly that policies de-
signed to prevent or ameliorate adverse impacts
and promote beneficial impacts need to be crafted
with consideration for regional structural/tech-
nological differences. Generalizing about the
impacts of changing agricultural technology
and structure on rural communities across re-
gions of the United States is difficult.

Impacts on Agricultural Research
and Extension
U.S. agriculture has been very successful to
an important extent because of technological
advances. However, agriculture's adoption of bio-
technology and information technology raises
several questions about the impact of technical
advances on the performance of the research
and extension system and about how that per-
formance will ultimately affect the structure of
Public research in the past was the driving
force for agricultural production. Now, with the
private sector becoming more involved in cer-
tain aspects of applied research, the public sec-
tor is emphasizing increased basic research.
This situation leaves open the question of who
will do applied research in the public sector.
Although the public sector has allocated re-
sources to research in biotechnology and infor-
mation technology, extension has done little
to make information about these technologies
available to farmers. The extension service must
thus decide what its mission will be, for exten-
sion policy will determine how effective mod-
erate farm operators will be in gaining access
to new technology. Without such access mod-
erate-size farms will disappear even faster.
Consideration of specific changes in research
and extension policy may be justified. The fol-
lowing areas have been identified as meriting
consideration for policy changes:
The social contract on which the agricul-
tural research and extension system was cre-
ated needs reevaluation. This issue should
not be left for resolution by the courts. Spe-
cific guidelines must be developed that al-
low the system to compete while protect-
ing the public interest and investment in
the agricultural research and extension
functions. Both Congress and the U.S. De-
partment of Agriculture (USDA) should
have a voice in this type of policy devel-
Some experts believe that increased private
sector support for agricultural research sig-

Ch. 1-Summary 19

nals less need for public support. Even
though private sector support complements
public support, basic biotechnology and
information technology research is very
costly. A reduced role for public research
and extension would result in a slower rate
of technological progress and a lower level
of protection for the public. In addition, the
public has a strong interest in maintaining
an agricultural research component in each
State to serve the problem-solving needs of
that State's agriculture.
* Many agricultural problems are local or re-
gional in scope. The applied nature of the
system, having an agricultural experiment
station and extension service in each State,
has provided a unique capacity to identify
and solve local or regional problems. Real-
ity suggests that only certain universities
have sufficient resources to compete for pri-
vate sector support in biotechnology and
information technology. The result is a con-
fluence of forces that is creating a dichot-
omy of "have" and "have not" universities.
There is, however, still an important role
for even the smallest, poorest funded land-
grant university. It plays an important part
in a national system designed to deal with
thousands of agro-ecosystems and to the
existence of a decentralized system with
nationwide capability. Because of these in-
equalities, there is concern that the tradi-
tional extension-research interaction and
feedback mechanisms could break down,
particularly in States that are not in a posi-
tion to command a major biotechnology
* The role of extension is even more impor-
tant than it has been in the past. New, more
complex products require evaluation and
explanation. In States where experiment
stations have attracted substantial private
sector support, the product testing function
can be most objectively performed by exten-
sion. The recently passed 1985 farm bill
gives explicit authority for extension to en-
gage in applied research functions such as
product testing and evaluation.
* While most agricultural research is not in-

herently biased toward large-scale farms,
lags in adoption by small and moderate
farms have the effect of such a bias. Unless
special attention is given to technology gen-
eration and transfer to moderate farms, ma-
jor structural changes could result, leading
to the eventual demise of a decentralized
structure that includes moderate farms. To
the extent that preservation of these farms
is a policy objective, special funding for and
emphasis on the problems of technology
generation and the transfer of that technol-
ogy to moderate farms is warranted.
* Although the agricultural research system
has received the benefits of increased fund-
ing from both private and public sources,
extension funding has not materially in-
creased. As a result, extension staff at the
county and specialist levels are being caught
up in a whirlwind of technological change.
The result is a need for the injection of sub-
stantial staff development funding into the
extension system.
* Basic organizational issues must be ad-
dressed by the Extension Service. The prem-
ise on which extension was developed was
that of research scientists conveying the
knowledge of discoveries to the extension
specialist who, in turn, supplied informa-
tion to the county agent who then taught
the farmer. Over time, this concept has
gradually but persistently broken down as
agricultural technology has become more
complex and insufficient resources have
been devoted to staff development. Conse-
quently, more emphasis has been placed
on direct specialist-to-farmer education.
More specialists have been placed in the
field to be closer to their clientele, but at
the cost of less contact with research scien-
tists. As these changes have occurred, the
role of the county agent has become increas-
ingly unclear. Appreciation for and use of
county agents as educators and technology
transfer agents has declined. As a result of
these changes, a basic structural reevalua-
tion of the organization of the extension
function of the agricultural research sys-
tem is needed.

20 Technology, Public Policy, and the Changing Structure of American Agriculture


The Issue of Farm Structure
This study indicates that the process of struc-
tural change in agriculture has already begun.
Based on a continuation of current policies, past
trends, and future technological expectations,
the net result of this structural change could be
the development of a farm structure composed
of three agricultural classes:
1. The large-scale farm segment would be
composed of a relatively small number of
farms that produce the bulk of U.S. produc-
tion. By year 2000 there could be as few as
50,000 large-scale farms producing as much
as three-fourths of the agricultural produc-
tion. This large-scale farm segment would
be highly efficient in the performance of
production, marketing, financial, and busi-
ness management functions. Such farms
would be run by full-time, highly educated
business managers. Barring unforeseen
acts of nature, farm operators would be able
to predict their chances of making a profit
before planting or breeding.
2. The struggling moderate-size farm segment
would be trying to find a niche in the mar-
ket and survive in an industrialized agri-
cultural setting. The potential for the mod-
erate farm finding that niche is rapidly
becoming the center of the farm policy de-
bate. Traditionally highly productive, effi-
cient, moderate-size, full-time farms have
been the backbone of American agriculture.
It is still true that a moderate, technologi-
cally up-to-date, and well-managed farm
with good yields is highly resilient. One key
to the success of these farms clearly lies in
the management factor. But more often
than not, management has to be willing to
accept a relatively low return on invested
capital, time, and effort. With ever-increas-
ing educational requirements associated
with farming, there will likely be less will-
ingness by successful managers of moder-
ate farms to accept a lower return for their
services and for invested capital. Another
key to the survival of moderate farms lies
in access to state-of-the-art technologies at

competitive prices. Cooperatives tradition-
ally have performed that role. But cooper-
atives by and large are not conducting or
funding basic or applied research in bio-
technology and information technology.
Also, like their predominantly moderate-
size farmer members, cooperatives, too,
have encountered financial difficulty.
3. The small, predominantly part-time farm
segment tends to obtain most of its net in-
come from off-farm sources. However, this
segment is highly diverse. It includes
wealthy urban investors and professionals
who use agriculture primarily as a tax shel-
ter and/or country home. It also includes
would-be moderate farm operators who are
attempting to use off-farm income as a
means of entering agriculture on a full-time
basis. Finally, this segment includes a num-
ber of poor, essentially subsistence, farmers
who are vestiges of the war on poverty in
the 1960s. Such farmers remain a signifi-
cant social concern that must be dealt with
from a policy perspective, although tradi-
tional farm price and income policy hold
no hope for solving their problems.
Contemporary farm programs have fostered
this trend toward three farm-size classes. Pay-
ments to farmers on a per-unit-of-production
basis concentrate most of the benefits in large
farms that produce most of the output. Large
farms have been in the best position to take
advantage of new technologies arising out of
the public sector agricultural research system.
Without substantial changes in the nature and
objectives of farm policy, the three classes of
farms will soon become two-the moderate-size
farm will largely be eliminated as a viable force
in American agriculture. In addition, the prob-
lems of the small subsistence farm will continue
to fester as an unaddressed social concern.
This section sets forth the policy changes that
would be required if it were decided by Con-
gress that overt steps should be taken to foster
a diverse, decentralized structure of farming
where all sizes of farms had an opportunity to

Ch. 1-Summary 21

compete and survive in a time of rapidly chang-
ing technology. The objective of giving every
farm the opportunity to compete and survive
does not imply an unchanging and stagnant
farm structure. It does imply a political and so-
cial sensitivity both to the impact of current farm
programs on farm structure and to the differ-
ent needs of large, moderate, and small farms
for Government assistance. It can be expected
that regardless of what Government does fewer
commercial farms will exist in year 2000. How-
ever, Government can do much to ease the pain
of adjustment.

Required Policy Adjustments
Substantive changes in policy direction are
needed to address the structure issue. Specifi-
cally, separate policies and programs must be
pursued with respect to each of the three farm
segments-large farms, moderate farms, and
small farms. The choice of any one set of pol-
icies to the exclusion of the other policy sets
would imply that Congress desired to selectively
enhance the status of one farm segment.
Policy for all farmers implies two basic pol-
icy goals:
All farmers need to operate in a relatively
stable economic environment where they
have an opportunity to sell what they
All farmers need a base of public research
and extension support whereby they can
maintain their competitiveness in the mar-
kets in which they deal.
The needs of large farms can be met by ad-
dressing just these goals. The needs of moder-
ate and small farms are more complex, how-
ever. Policy to address the needs of moderate
and small farms must include the elements of
large farm policy as well as additional elements.

Policy for Large Commercial Farms
A basic conclusion of this study is that large-
scale farmers do not need direct Government
payments and/or subsidies to compete and sur-
vive. However, this does not preclude the need
for a commercial farm policy.

The criteria for determining what constitutes
a large-scale farm is important but also some-
what arbitrary. The dividing line developed
from this study is about $250,000 in sales for
a crop or dairy farm unit under single owner-
ship or control. This level of sales is generally
required to achieve most of the economies of
size found to exist in agricultural production.6
Over time, this optimum size has had, and will
continue to have, a tendency to increase. As this
occurs, the farm size criteria for limiting pro-
gram benefits would likewise have to increase.
Creating a Stable Economic Environment.-
The policy goal of creating a relatively stable
economic environment where farmers have an
opportunity to sell what they produce implies
the following major farm program initiatives:
Direct Government payments to all farms
having over $250,000 in sales would be
eliminated. This implies the elimination of
the target-price concept for this sales class.
Elimination of payments to those farms
would significantly reduce Government ex-
penditures in agriculture.
The nonrecourse loan would be converted
to a recourse loan. The nonrecourse fea-
ture has resulted in the accumulation of
large Government commodity stocks. The
recourse feature would provide a continu-
ing base of support for the orderly market-
ing of farm products.
Aside from the recourse price support loan,
Government credit to farms having over
$250,000 in sales would not be available.
An expanded international development
assistance program would be established.
Such a program would have to include an
optimum balance of commodity aid and
economic development aid. Its primary
objective would be to help developing coun-
tries improve economic growth, thus be-
coming better future customers of Amer-
ican agriculture.
A balanced macroeconomic policy that
facilitates growth of export markets and

eThe $250,000 figure is based on census data and the economies
of size analysis discussed previously.

22 Technology, Public Policy, and the Changing Structure of American Agriculture

maintains a relatively low real rate of in-
terest would have to be maintained.
Maintaining Technological Competitiveness.
-The technological competitiveness of Amer-
ican farmers would be aided by continuing a
policy that encourages public and private in-
vestment in agricultural research. The major
thrust of the research and extension programs
as they affect larger scale commercial farms
would be as follows:
The trend toward increased public sector
emphasis on basic research would be con-
tinued. Increased reliance would be placed
on the private sector for applied research
in the development of new products.
Even though public sector research would
be aimed more toward basic research, an im-
portant problem-solving component would
be maintained to adopt new technologies
to various agro-ecosystems and to maintain
newly achieved productivity from the evo-
lution of pests and disease, decline in soil
fertility, and other factors.
Extension's role in direct education of,
or consultation with, large-scale farmers
would be deemphasized. Private consul-
tants could play an increased role in tech-
nology transfer to the large-scale farm

Policy for Moderate-Size Farms
Policy for moderate farms includes the afore-
mentioned options as well as additional options
tailored specifically to the needs of moderate
farms. OTA finds, for example, that moderate
farms having $100,000 to $250,000 in gross sales
face major problems of competing and surviv-
ing in the biotechnology and information tech-
nology era. Some moderate farms will survive
and some will not. This latter group should be
assisted in their move to other occupations.
Policy for moderate farms requires the same
stable economic environment and base of sup-
port for agricultural research and extension as
for large farms. But, in addition, the following
specific policy goals for moderate farms can be

The risk of moderate farmers operating in
an open market environment would be
New technologies that have the potential for
adoption would be available to moderate
Opportunities for employment outside agri-
culture would be created for those farmers
who are unable to compete.
Diligent enforcement would be needed to as-
sure that the benefits of programs established
to favor moderate farms are limited to those
farmers for whom they are intended.
Reducing Risks to Moderate-Size Farms.-The
most difficult obstacle to survival facing the
moderate farm is that of managing risk. Three
options, that are not necessarily mutually ex-
clusive, could reduce the risks confronting mod-
erate farms.
1. Income protection could be provided through
either a continuation of the current target-
price concept for moderate farms only or
through a device known as the marketing
loan. Like the current nonrecourse loan, the
marketing loan is a loan from the Govern-
ment on commodities in storage. If the com-
modity is sold for less than the loan value,
the farmer pays back only those receipts
to the Government in full payment of the
loan. The marketing loan, in essence, be-
comes a guaranteed price to the producer.
The level of the marketing loan should be
no greater than the average cost of produc-
tion for moderate farmers.
2. The nonrecourse loan concept could be
continued for moderate farms. However,
the nonrecourse loan level should not be
set any higher than the recourse loan sug-
gested previously for large farms, or else
the Government could end up acquiring
most of the production from moderate
3. Sharply increased assistance could be pro-
vided by the public sector to reduce the risk
to moderate farms. Such assistance could
be in the form of educational programs for
example, on risk management, futures mar-
kets, contracting, and cooperative mar-

Ch. 1-Summary 23

Technology Availability and Transfer to Mod-
erate-Size Farms.-OTA finds that agricultural
research, as a general rule, is not inherently bi-
ased against moderate farms. Rather, moder-
ate farms may be seriously disadvantaged ei-
ther by lags in adoption or by lack of access to
competitive markets for the products produced
by new technology. The following initiatives
could help curtail such problems of technology
availability and transfer.
Extension's evaluation of the increasing
number of new products entering the mar-
ket would be intensified. This increased ef-
fort would play the dual role of: 1) provid-
ing a check on the efficacy and efficiency
of new products in biotechnology and in-
formation technology, and 2) eliminating
the costs associated with individual farmer
experimentation with those new products.
Extension technology transfer services
would be aimed specifically at moderate-
size farms. The primary goal of such pro-
grams would be to ensure the same sched-
ule of adoption of technologies for
moderate-size as well as large farms.
The development of cooperatives that em-
phasize technology supply and transfer
services to moderate farms would have to
be undertaken.
Ample credit would have to be made avail-
able to moderate-size farms that have the
potential to survive and grow. Government
credit in concert with cooperative credit
could be aimed specifically toward filling
the needs of moderate-size farms. Empha-
sis should be placed on credit required to
keep moderate farms technologically up-
Transition Policy to Other Agricultural En-
terprises or Nonfarm Employment.-Regardless
of the effectiveness of the initiatives discussed
above, an accelerated need exists to assist farm
families to either move to other agricultural en-
terprises or out of agriculture into other occu-
pations. The need arises, therefore, for specific
public action to facilitate the farmer's transi-
tion from the current farm operation into gain-
ful, productive employment elsewhere. Specific
initiatives to ease this process include the fol-

New opportunities for employment of dis-
placed farmers need to be explored and de-
veloped within agriculture as the industry
continues to evolve.
To facilitate the transition to nonfarm jobs,
special skills training programs aimed at
those areas where significant employment
opportunities exist must be considered.
Jobs in rapidly growing service, health care,
or care-for-the-aged industries provide con-
temporary examples.
Financial assistance, similar to the famous
G.I. bill, might be established to assist dis-
placed farmers or rural residents during the
period of transition while skills training is
being received.
In areas of severe financial stress, assis-
tance may be provided in the form of Gov-
ernment purchase of land or production
rights from displaced farmers at its "long-
term fair market value." The returns from
the land could be used by the displaced
farmer for relocation and retraining. The
Government could retain the land in con-
servation reserve status until it is needed
for future production.

Policy for Small/Part-Time Farms
Policy for small/part-time farms includes sev-
eral elements in addition to those mentioned
under large farm policy.
With few exceptions, small farms, those hav-
ing less.than $100,000 in sales, are not viable
economic entities in the mainstream of commer-
cial agriculture-nor can they be made so. How-
ever, even a small increase in their farm income
could have a significant multiplier effect on the
local economy because of the large number of
small farms. These farms survive because their
operators have substantial outside income (part-
time farmers), or because they have found them-
selves a niche in marketing a unique product
with special services attached (often direct to
consumers), and/or because they are willing to
accept a very low return on resources contrib-
uted to the farming operation.
For the small farmers who have substantial
outside income or who have found a niche in
the market, Government's role would be severe-

24 Technology, Public Policy, and the Changing Structure of American Agriculture

ly restricted. They are as much able to take care
of themselves as owners of large farms.
However, small subsistence farmers who have
limited resources, and often limited revealed
abilities, represent genuine problem for which
public concern is warranted-these indeed are
the rural people left behind. Price and income
support programs have done and can do little
to solve their problems. These impoverished in-
dividuals are a social and economic problem.
The following suggestions are made for deal-
ing with the problems of subsistence farmers:
Initiate a special study to identify those in-
dividuals and their specific statuses and
needs. Develop social programs to meet
those needs.
USDA and the land-grant university bear
a special burden of responsibility for serv-
ing the needs of these subsistence farmers.
This responsibility has not generally been
realized and, therefore has not been ful-
filled. In the South, this responsibility falls
particularly heavily on the 1890 land-grant
universities in concert with the statewide
extension education programs and the 1862
land-grant universities. In the North, the
responsibility for serving the agricultural
educational and research needs of subsis-
tence farmers falls exclusively on the 1862
land-grant universities.
USDA and these land-grant universities
could be directed to develop jointly a plan
for serving the agricultural research and
educational needs of these farmers. Such
a plan could include the delivery of farm-
ing, credit, and marketing systems designed
to maximize the small farm's agricultural
production and earning capacity.
Specific farming systems must be devel-
oped to serve specifically the needs of small
subsistence farms. Such systems should, to
the extent practicable, encompass the use
of new technologies.
Credit delivery systems for small subsis-
tence farmers could be developed specifi-
cally by USDA through the Farmers Home
Administration. Such systems should con-
sider the unique capital and cash flow-lim-
iting factors associated with subsistence

farmers who are often not in a position to
take advantage of other farm programs such
as price and income supports.
*Marketing programs geared to subsistence
agriculture are essential for providing hope
for this farm segment. The difficulty lies
in the inability of these farmers to obtain
access to the mass markets through which
most agricultural production moves.

Policy for Rural Communities
The impact of adjustment in agriculture to
changing technology will by no means be lim-
ited to the farm sector. Rural communities will
be at least equally affected by increasing farm
size, integration, and moderate farm displace-
ment. Although, these effects will be felt initially
by implement dealers, farm supply and market-
ing firms, or bankers, the reverberations will
extend throughout the community in terms
of employment levels, tax receipts, and required
services. Rural communities should assess these
impacts and prepare to make needed adjust-
ments. To ease the pain of adjustment the fol-
lowing actions are suggested:
Comprehensive programs for community
redevelopment and change need to be ini-
tiated throughout rural America. Such de-
velopment plans should be fostered and
facilitated by Federal and State government
Increased employment opportunities in ru-
ral areas could be fostered by aggressively
attracting new business activities in rural
communities. Particular emphasis would
be placed on attracting those businesses
that develop technologies and serve the
needs of high-technology agriculture in ru-
ral areas.
Rural communities could be assisted in de-
veloping and modernizing the infrastruc-
ture needed to be a socially and economi-
cally attractive place to live. Some rural
communities can serve as an attractive re-
tirement residence for an aging population.
But this would require that a higher level
of social services be developed.
Rural communities need to play a vital role
in skills training for displaced farmers and

Ch. 1-Summary 25

rural community employees. School and
university outreach programs could be
modified to serve this important role.

Policy for Technology and
Environmental Resource Adjustment
One of the major reasons that American agri-
culture has been so productive is because tech-
nological change has been fostered by the pub-
lic sector and nurtured by a profit-seeking
private sector. As a result, American consumers
have enjoyed a plentiful supply of low-cost food
and natural fiber. In addition, agricultural ex-
ports have made a major contribution to the
overall development of export markets, to the
benefit of the general economy. Biotechnology
and information technology promise to offer
more of the same, with the added bonus of less
chemicals used in the production of food-
whether for the control of pests, disease, and
weeds, or for the production of commercial fer-
Maintaining the productivity and competi-
tiveness of U.S. agriculture in the public inter-
est requires a balance between public and pri-
vate sector support for technological change.
Yet it would be wrong to imply that there are
no risks. The conferring of property rights on
discoveries of the agricultural research system
has shifted the agricultural research balance be-
tween the public and private sectors toward the
private sector. While the effects of this shift ap-
pear to be positive, concerns exist that a sub-
stantial portion of the benefits of even public
research could be captured by private firm in-

terests. Distribution of these benefits may be so
unequally distributed that competitive perform-
ance is impaired. In addition, no scientifically
acceptable methodology exists for weighing the
risks or hazards of biotechnology research. To
deal with such issues, the following policy sug-
gestions are made:
Steps should be taken to secure the public
interest on which the USDA and land-grant
university agricultural research system has
been based. Assurance must be provided
that the benefits of publicly supported re-
search and extension are not captured in
the form of excess profits by the private sec-
tor based on research property rights and
increased private sector funding of public
research. The effect would be to stifle the
process of discovery and the dissemination
of new knowledge.
Major investments must be made to foster
the development of human capital that is
in a position to cope with the process of
rapidly changing agricultural technology.
This need extends from the training and de-
velopment of the most basic biological re-
search scientists, through the extension spe-
cialist and county agent, to the farmer who
adopts the new technology and the banker
who supplies the loan for its purchase.
Little is known about the adverse impacts
of potential biotechnology developments
on the ecosystem. These risks must be care-
fully assessed, monitored, and where nec-
essary, regulated. Care must be taken, how-
ever, not to overregulate and thereby stifle
the potential competitiveness and produc-
tivity of U.S. agriculture.


The biotechnology and information technol-
ogy revolution in agricultural production has
the potential for creating a larger, safer, less ex-
pensive, more stable, and more nutritious food
supply. Yet it will exact substantial costs in po-

tential adjustment problems in the agricultural
sector and in rural communities. Those costs
can be minimized by careful analysis, planning,
and implementation. This study is only the first
step in that direction.

Part I
The Emerging Technologies

Chapter 2
Emerging Technologies
for Agriculture


Biotechnology ........................................ ............ 31
Animal Agriculture ................... .... .......... ............ 31
Plant A agriculture ................................................ 32
Inform ation Technology ................................... ....... 32
Survey of Emerging Technologies ................................... 33
Animal Genetic Engineering ................................... 33
Anim al Reproduction .......................................... 37
Regulation of Livestock Growth and Development .................... 38
A nim al N nutrition ..................... ... .. ........ .......... 39
Anim al Disease Control .......................................... 40
Livestock Pest Control ............................... ........... 41
Environment and Animal Behavior ................................ 42
Crop Residues and Animal Wastes ................................. 42
Plant Genetic Engineering ............................ ........... 44
Enhancement of Photosynthetic Efficiency .......................... 47
Plant Growth Regulators .............................. ........... 48
Plant Disease and Nematode Control ............................... 49
Management of Insects and Mites ................................. 50
Biological Nitrogen Fixation ....................... ........... 52
Water and Soil-Water-Plant Relations ............................... 53
Land M anagem ent .......................... .. .................. 54
Soil Erosion, Productivity, and Tillage .............................. 56
M multiple Cropping ............................................ 58
Weed Control ........... .............. ... ............. 59
Com m ercial Fertilizers ................... .... ................... 60
O rganic Farm ing .............................................. 61
Communication and Information Mangement ....................... 62
Monitoring and Control Technology ............................. 63
Telecommunications ....................... .... ............... 65
Labor-Saving Technology ......................................... 67
Engines and Fuels ............................ ................... 68
Crop Separation, Cleaning, and Processing Technology ............... 68
Chapter 2 References ............................................ 70

Table No. Page
2-1. Emerging Agricultural Production Technology Areas ............... 34

Figure No. Page
2-1. General Configuration of Information Technologies in Production
A agriculture .................................................... 33
2-2. Recombinant DNA Procedure .................................... 34
2-3. Monoclonal Antibody Production ................................. 36
2-4. Schematic Presentation of Cow Embryo Transfer Procedures ......... 37
2-5. Plant Propagation-From Single Cells to Whole Plants ............... 45
2-6. Gene Modification-Insertion of a Desired Gene Into the
Host Plant Through Vectors .................................... 46
2-7. Configuration of Monitoring and Control Technologies in Agriculture 65

Chapter 2

Emerging Technologies for Agriculture

American agriculture is on the threshold of
the biotechnology and information technology
era. Like the eras that preceded it-the mechan-
ical era of 1930-50 and the chemical era of 1950-
70-this era will bring technologies that can sig-
nificantly increase agricultural yields.
The immediate impacts of the biotechnologies
will be felt first in animal production. Through
embryo transfers, gene insertion, growth hor-
mones, and other genetic engineering tech-
niques, dairy cows will produce more milk per
cow; cattle, swine, sheep, and poultry will pro-
duce more meat per pound of feed. Impacts in
plant production will take longer to occur,
almost the remainder of the century. By that
time, however, technical advances will allow
major crops to be altered genetically for disease
and insect resistance, higher production of pro-
tein, and self-production of fertilizer and her-
bicide. Until then, crop yields will increase
through the use of traditional technologies, but
at less than past rates.
Both plant production and animal production
will benefit from advances in information tech-
nology. Computers, telecommunications, mon-
itoring and control technology, and informa-
tion management will be widely used on farms
to increase management efficiency.
Some of these new technologies will emerge
unexpectedly; however, most will undergo a
long process of development, from initiation of
ideas to commercial introduction. Since the

development of a new technology takes years,
often decades, it is often possible to forecast fu-
ture technologies while they are still in the lab-
oratory. One method is to obtain collective judg-
ments from experts who have direct access to
the latest available information, a method OTA
chose. OTA collected information from three
rounds of a mailed survey to about 300 leading
public and private scientists and research ad-
ministrators who had broad, cross-cutting per-
spectives about future technologies (Lu, 1983).
Based on these surveys and on subsequent inter-
views with scientists in various disciplines
around the country, OTA thus identified the 28
areas of emerging technologies that are likely
(with at least a 50-50 chance) to emerge before
2000 and to have major impacts on the agricul-
tural sector. Many of the technologies examined
for this study, such as growth hormones, mon-
oclonal antibodies, superovulation, and embryo
transfers, are already in the marketplace, while
others are still in the laboratory and will not be-
come available for commercial introduction un-
til 2000.
This chapter presents an overview of the ma-
jor advances in biotechnology and information
technology and then describes in more detail
the 28 areas of technologies that were assessed
for this study. It should be noted that some of
the emerging technologies assessed will be in
neither the biotechnology nor information tech-
nology categories.


Biotechnology, broadly defined, includes any
technique that uses living organisms to make
or modify products, to improve plants or ani-
mals, or to develop micro-organisms for specific
uses. It focuses on two powerful molecular ge-
netic techniques, recombinant deoxyribonu-
cleic acid (rDNA) and cell fusion technologies.
With these techniques scientists can visualize
the gene-to isolate, clone, and study the struc-
ture of the gene and the gene's relationships to

the processes of living things. Such knowledge
and skills will give scientists much greater con-
trol over biological systems, leading to signifi-
cant improvements in the production of plants
and animals.

Animal Agriculture
One of the major thrusts of biotechnology in
animal agriculture is the mass production in

32 Technology, Public Policy, and the Changing Structure of American Agriculture

micro-organisms of proteinaceous pharmaceu-
ticals,' including a number of hormones, en-
zymes, activating factors, amino acids, and feed
supplements (Bachrach, 1985). Previously ob-
tained only from animal and human organs,
these biologicals either were unavailable in prac-
tical amounts or were in short supply and costly.
Some of these biologicals can be used for the
detection, prevention, and treatment of infec-
tious and genetic diseases; some can be used
to increase production efficiency.
Another technique, embryo transfer in cows,
involves artificially inseminating a superovu-
lated donor animal2 and removing the result-
ing embryos nonsurgically for implantation in
and carrying to term by surrogate mothers. Prior
to implantation, the embryos can be treated in
a number of ways. They canbe sexed, split (gen-
erally to make twins), fused with embryos of
'Pharmaceuticals that are proteins.
2An animal that has been injected with a hormone to stimulate
the production of more than the normal number of eggs per ovu-

other animal species (to make chimeric animals
or to permit the heterologous species to carry
the embryo to term), or frozen in liquid nitrogen.
These and other genetic engineering tech-
niques are explained more fully under "Animal
Genetic Engineering," later in this chapter.

Plant Agriculture
The application of biotechnologies in plant
agriculture could modify crops so that they
would make more nutritious protein, resist in-
sects and disease, grow in harsh environments,
and provide their own nitrogen fertilizer. While
the immediate impacts of biotechnology will be
greater for animal agriculture, the long-term
impacts may be substantially greater for plant
agriculture. The potential applications of bio-
technology on plant agriculture include micro-
bial inocula, plant propagation, and genetic
modification (Fraley, 1985). All are explained
later in this chapter under "Plant Genetic Engi-


Agricultural information technologies can be
classified as: 1) communication and informa-
tion management, 2) monitoring and control
technologies, or 3) telecommunications. The
relationships of these classifications are shown
in figure 2-1.
Communication and information manage-
ment consists of onfarm digital communication
systems, known generically as local area net-
works (LANs), combined with the microcom-
puter-based information processing technol-
ogies used by the farm operator as the central
information processing and management sys-
tem. This central computer system may include
remote terminals with keyboards, display
screens, and printers used for onsite data entry
and readout by the farm operator. The computer
terminals are indicated on figure 2-1 by the small
boxes labeled "T."
Monitoring and control technologies auto-
matically monitor and control certain aspects
of a wide variety of production processes. These

technologies, generally considered to be sub-
systems, are located at the site of production
activities, such as livestock confinement sys-
tems, storage facilities, and irrigation pumping
and control stations, and on mobile equipment
such as tractors and combines. Monitoring and
control systems can function autonomously, al-
though they are increasingly being connected
to the central onfarm information processing
system through fixed links and low-power ra-
dio links to the onfarm LAN. The LAN connec-
tions between the central information manage-
ment system and the onsite monitoring and
control technologies are indicated by the boxes
on figure 2-1 labeled "N," for network node. Sev-
eral different kinds of local configurations of
the LAN and the components of the onfarm
computer system are possible. The arrangement
shown here is just one of many possibilities.

Telecommunication technologies comprise
the hardware and software that connect the on-
farm systems with the rest of the world so that

the farmer can communicate with people and
with computer systems in other firms and in-
stitutions. Telecommunication systems may
combine both voice and data communications.

Ch. 2-Emerging Technologies for Agriculture 33

Three types of telecommunication technologies
are shown on figure 2-1: satellite ground sta-
tions, low-power radio links, and telephone

Figure 2-1.-General Configuration of Information Technologies in Production Agriculture

SOURCE: Office of Technology Assessment.


The 28 areas of technologies are shown in ta-
ble 2-1. OTA commissioned papers by leading
scientists in each of these technological areas.
A summary of each paper is presented in this

3The papers prepared by those scientists are referenced at the
end of this chapter and are available in Technology, Public Pol-
icy, and the Changing Structure of American Agriculture, Vol-
ume I--Background Papers through the National Technical In-
formation Service, U.S. Department of Commerce.

Animal Genetic Engineering
Genetic engineering includes a number of pro-
cedures by which genes canbe manipulated for
improving the health and productivity of plants,
animals, and humans (Bachrach, 1985). Three
important genetic engineering procedures are:
1) recombinant DNA (rDNA) techniques, also
called gene splicing; 2) monoclonal antibody
production; and 3) embryo transfer.

Recombinant DNA Techniques
Because of its power to alter life forms, rDNA
technology is considered to be one of the great-

34 Technology, Public Policy, and the Changing Structure of American Agriculture

Table 2-1.-Emerging Agricultural Production Technology Areas

Animal genetic engineering
Animal reproduction
Regulation of growth and development
Animal nutrition
Disease control
Pest control
Environment of animal behavior
Crop residues and animal wastes use
Monitoring and control in animals
Communication and information management
Labor savinga

aThese technologies also apply to plant, soil, and water.
SOURCE: Office of Technology Assessment.

est achievements of biological science. Through
this technology DNA fragments from two differ-
ent species can be fused together to form new
units called recombinant plasmids (figure 2-2).
Such rDNA molecules might contain, for ex-
ample, a gene from human insulin fused with
DNA that regulates the reproduction of bacte-
ria. When such molecules are inserted into bac-
teria, they instruct that bacteria to manufacture
human insulin. Molecules of rDNA can now be
inserted into a variety of bacteria, yeasts, and

Plant, soil, and water
Plant genetic engineering
Enhancement of photosynthetic efficiency
Plant growth regulators
Plant disease and nematode control
Management of insects and mites
Weed control
Biological nitrogen fixation
Chemical fertilizers
Water and soil-water-plant relations
Soil erosion, productivity, and tillage
Multiple cropping
Organic farming
Monitoring and control in plants
Engine and fuels
Land management
Crop separation, cleaning, and processing

animal cells, where they replicate and produce
many useful proteins, such as insulin, growth
hormones, prolactin, prolaxin, enzymes, toxins,
blood proteins, subunit protein vaccines, im-
munity enhancers (such as interferons and inter-
leukins), and nutrients like amino acids and
single-cell protein feed supplements. Recombi-
nant DNA technology also produces DNA se-
quences for use as probes in detecting bacterial
poisoning of foods and for diagnosing and treat-
ing infectious and genetic diseases.

Figure 2-2.-Recombinant DNA Procedure

Enzyme cuts twice
freeing a gene

'CtL. ?

Sticky ends
spliced by

Enzyme cuts
vector open

rDNA plasmid

Bacterium with
functional animal gene

Bacterial DNA plasmid
An animal gene is spliced into a carrier DNA (called a vector) for insertion into a micro-organism (a bacterium is shown) or alternate animal
host cell, and is made to replicate and express Its protein product.
SOURCE: Office of Technology Assessment.

Ch. 2-Emerging Technologies for Agriculture 35

One of the applications of the new pharma-
ceuticals is the manufacture of growth hor-
mones that can be injected into animals to in-
crease production efficiency. Monsanto, Eli
Lilly, and other firms are developing genetically
engineered bovine growth hormone (bGH) to
stimulate lactation in cows. This hormone,
produced naturally by a cow's pituitary gland,
was synthesized by Genentech for Monsanto.
It has been reported that daily injections of bGH
into dairy cows at the rate of 44 milligrams per
cow per day have resulted in an increase of 10
to 40 percent in milk yield. The response to in-
jections is rapid (2 to 3 days) and persists as long
as treatment is continued (Kalter, et al., 1984).
More recently, it was reported that the bGH
treatments have increased milk yield 25 to 30
percent in the laboratory and could increase
milk yield 20 percent on the farm (Kalter, 1985).
The new hormone now awaits approval by the
U.S. Food and Drug Administration and is ex-
pected to be introduced commercially in 1988
(Bachrach, 1985; Hansel, 1985; Chem. andEng.
News, 1984).
Another new technique arising from the con-
vergence of gene and embryo manipulations
promises to permit genes for new traits to be
inserted into the reproductive cells of livestock
and poultry, opening a new world of improve-
ment in animal health and production effi-
ciency. Unlike the genetically engineered
growth hormone, which increases an animal's
milk production or body weight but does not
affect future generations, this technique will al-
low future animals to be permanently endowed
with traits of other animals and humans, and
probably also of plants. In this technique, genes
for a desired trait, such as disease resistance
and growth, are injected directly into either of
the two pronuclei of a fertilized ovum (egg).
Upon fusion of the pronuclei, the guest genes
become a part of all of the cells of the develop-
ing animal, and the traits they determine are
transmitted to succeeding generations.
In 1983, scientists at the University of Penn-
sylvania and University of Washington success-
fully inserted a human growth hormone gene,
a gene that produces growth hormone in human
beings, into the embryo of a mouse to produce

a supermouse that was more than twice the size
of a normal mouse (Palmiter, et al., 1983). In
another experiment, scientists at Ohio Univer-
sity inserted rabbit genes into the embryos of
mice. The genetically engineered mice were 2.5
times larger than normal mice (Wagner, 1985).
Encouraged by the success of the supermouse
experiments, U.S. Department of Agriculture
(USDA) scientists at the Beltsville Agricultural
Research Center and the University of Penn-
sylvania are conducting experiments to produce
better sheep and pigs by injecting the human
growth hormone gene into the reproductive
cells of sheep and pigs (Hammer, 1985). USDA
scientists provide scientists at the University
of Pennsylvania with fertilized embryos from
sheep and pigs at their Beltsville farms. After
being injected with the human growth hormone
genes, the embryos are returned to Beltsville for
insertion into surrogate mothers.
The experiments of crossing the genetic ma-
terials of different species in general and of
using the human growth hormone in particu-
lar have prompted lawsuits from two scientific
watchdog groups: the Foundation of Economic
Trends and the Humane Society of the United
States. Both groups charge that such experi-
ments are a violation of "the moral and ethical
canons of civilization," and have sought to halt
the experiments. The researchers argued that
they are continuing the experiments cautiously
and countered that the potential scientific and
practical benefits far outweigh the theoretical
problems raised by the critics. While the law-
suit is pending, the experiments are continuing.
Monoclonal Antibody Techniques
Antibodies are proteins produced by white
blood cells in response to the presence of a for-
eign substance in the body, such as viruses and
bacteria. Each antibody can bind to and inacti-
vate a cell of the foreign substance but will not
harm other kinds of cells. Until recently, the pri-
mary source of antibodies used for immuniza-
tion and other purposes was blood serum from
many animal species. However, such serum also
contains antibodies to hundreds of other sub-
stances, and each antibody type was limited in

36 Technology, Public Policy, and the Changing Structure of American Agriculture

To produce large quantities of a single anti-
body, scientists now use a technique called mon-
oclonal antibody production (figure 2-3). By fus-
ing a myeloma cell4 with a cell that produces
an antibody, scientists create a hybridoma,
which produces (theoretically in perpetuity)
large quantities of identical (i.e., monoclonal)
antibodies in a pure, highly concentrated form.
An array of monoclonal antibodies can now be
produced to fight major virus, bacteria, fungi,
and parasites and to diagnose the presence of
a specific agent inbody fluid. The many impor-
tant uses of monoclonal antibodies in agricul-
ture include: the purification of proteins made
by rDNA; the passive immunization of calves
against scours; the detection of food poisoning;
substitutions for vaccines, antitoxins, and anti-
venoms; sexing of livestock embryos; post-coital
contraception and pregnancy testing; the imag-
ing, targeting, and killing of cancer cells; the
monitoring of levels of hormones and drugs; and
the prevention of rejection of organ transplants.

Embryo Transfer
Embryo transfer is used for the rapid upgrad-
ing of the quality and productive efficiency of
livestock, particularly cattle. In the process a
superovulated donor animal is artificially in-
seminated, and the resulting embryos are re-
moved nonsurgically for implantation in and
carrying to term by surrogate mothers (figure
2-4). Before implantation, the embryos can be
sexed with monoclonal antibody, split to make
twins, fused with embryos of other animal spe-
cies, or frozen in liquid nitrogen for storage until
the estrus of the surrogate mother is in syn-
chrony with that of the donor.
For gene insertions, the embryo must be in
the single-cell stage, having pronuclei that can
be injected with cloned foreign genes. The genes
likely to be inserted into cattle may be those for
growth hormones, prolactins (lactation stimu-
lator), digestive enzymes, and interferons, col-
lectively providing both growth and enhanced
resistance to disease.

4Myelomas are cancerous, antibody-producing cells.

Spleen cells

Figure 2-3.-Monoclonal Antibody Production


To produce monoclonal antibodies, spleen cells from a mouse im.
munized against a specific disease are fused with mouse tumor (mye-
loma) cells to create hybrid cells (hybridoma) that grow in culture. The
hybridoma cells are then screened for the production of antibodies.
Hybridomas that test positive are injected into a mouse, and the
mouse becomes a living factory for the production of antibodies
against the same disease. Other positive hybridomas are frozen for
future use.
SOURCE: U.S. Department of Agriculture, Agricultural Research Service.

While less than 1 percent of U.S. cattle are
involved in embryo transfers, the obvious ben-
efits will cause this percentage to increase rap-
idly, particularly as the costs of the procedure
decrease (Brotman, 1983). One company, Genetic
Engineering Inc., already markets frozen cat-
tle embryos domestically and abroad and pro-
vides an embryo sexing service for cattle breed-
ers (Genetic Engineering News, 1983).

Growth in myeloma
cell suspension

0 Myeloma cells




Ch. 2-Emerging Technologies for Agriculture 37

Figure 2-4.-Schematic Presentation of Cow Embryo Transfer Procedures

Superovulatlon of donor
with gonadotropins

Artificial Insemination (5 days
after initiating superovulation)

Nonsurgical recovery of embryos (8 to
8 days after artificial insemination)

Foley catheter for
recovery of embryos

-4 -::

Transfer of embryos to recipients through the
surgically or nonsurglcaly months after
SOURCE: Adapted from G.E. Seidel, Jr., "Super Ovu
Jan. 23, 1981, p. 353.

Because of intense competition between hun-
dreds of firms in the United States and abroad,
a great many useful genetically engineered prod-
ucts and processes will be introduced during
the 1980s.

Animal Reproduction

The field of animal reproduction is undergo-
ing a scientific revolution that could scarcely
have been visualized a decade ago (Hansel,
1985). Indeed, if all of the technology now avail-
able were used, a new kind of animal breeding
system could be put into operation within 10
By year 2000, artificial insemination may be
replaced by a system best characterized as "arti-
ficial embryonation." In this system highly
trained technicians will place embryos into the

Storage of embryos indefinitely
Isolation and classlft- in liquid nitrogen or at 37C
cation of embryos or room temperature for 1 day

Pregnancy diagnosis by palpation

rectal wall 1 to 3
embryo transfer

Birth (9 months after
embryo transfer)

lation and Embryo Transfer in Cattle," Science, vol. 211,

uteri of groups of outstanding female animals
whose estrous cycles have been regulated by
artificial means, such as hormone injections,
ear implants, or intravaginal devices. The ova
from this "superovulation" will be culled sur-
gically or nonsurgically (by flushing) and then
fertilized in the laboratory by spermatozoa from
outstanding males. The fertilized ova can then
be cultured, frozen, and stored until needed.
Finally, the embryos will be placed in foster
mothers nonsurgically.
Ultimately, it may be possible to sex the em-
bryos by separating the X- and Y-bearing sper-
matozoa or by identifying the male embryos by
immunological techniques so that recipient beef
cows will receive primarily male embryos and
dairy cows will receive primarily female em-
bryos. Techniques for reducing early embryonic
deaths, the major cause of infertility in all farm

38 Technology, Public Policy, and the Changing Structure of American Agriculture

animals, are also likely to be developed within
this time frame.
Achieving these goals will entail the funding
of research in three major areas: 1) the develop-
ment of improved estrous cycle regulation
techniques; 2) the development of improved
techniques for superovulation and embryo col-
lection, storage, sexing, and transfer; and 3) the
development of methods for reducing embryo
mortality and improving fertility in all classes
of farm animals.
Vigorous pursuit of research in these areas
could result, by year 2000, in the marketing of
large numbers of genetically engineered em-
bryos containing genes that will improve fer-
tility and fecundity and will result in improved
rates of gain, improved carcass characteristics,
increased milk production, and increased re-
sistance to diseases in offspring. Despite recent
spectacular breakthroughs in introducing hu-
man genes into laboratory animals, a great deal
remains to be learned about the factors that con-
trol chromosomal integration of foreign DNA,
the retention of that DNA during embryonic de-
velopment, and ultimately the expression of
DNA, without disruption of the formation and
development of the embryo. These developments
will affect the major drug companies, genetic
engineering companies, equipment manufac-
turers, veterinarians, inseminators, and exten-
sion workers, as well as the Nation's farmers.
The ultimate goal of this research is to increase
the efficiency of production so that fewer ani-
mals, and less input of labor will be needed to
produce the needed animal products.

Regulation of Livestock
Growth and Development
The rate and composition of growth is a criti-
cal factor in determining the cost of producing
livestock products (Allen, 1985). While much
is known about genetic and nutritional varia-
bles that influence animal growth, much less
is known about the hormonal, cellular, and
metabolic mechanisms that determine how and
at what rate nutrients are partitioned into the
growth of muscle, fat, bone, and the tissues of

major concern. An understanding of these fun-
damental mechanisms is needed to provide a
foundation for applying new technologies to the
development of products to improve the rate,
efficiency, and composition of animal growth.
The potential applications of genetic engi-
neering, cloning, and immunology for the im-
provement of growth in food-producing animals
are many. For example, recombinant DNA tech-
nology is responsible for providing sufficient
quantities of bovine and porcine growth hor-
mone so that scientists can now determine their
role, mode of action, and potential use when
administered to animals used for producing
meat and milk. In the future, this kind of re-
search may also lower the cost of beef produc-
tion by permitting small cows, which have lower
maintenance costs, to produce large market cat-
tle of desirable composition. It also seems likely

Photo credit: U.S. Department of Agriculture, Agricultural Research Service
Ultrasonic techniques to measure backfat may someday
provide data for evaluating fat and lean composition in
live animals during various stages of growth.

Ch. 2-Emerging Technologies for Agriculture 39

that biotechnology will give rise to new prod-
ucts that can alter the inherent mechanisms of
muscle protein and adipose (fat) tissue accre-
tion so that the efficiency of meat production
will be improved by the conversion of more nu-
trients into lean meat and less nutrients into fat.
Such a development would be in keeping with
the consumer demand for lean, but highly palat-
able, meat at a reasonable cost, and with the
medical recommendations that the U.S. con-
sumer reduce the intake of calories from die-
tary fat.
Other opportunities for advances involve the
physical sciences. These include the need for
more rapid, accurate, and economical ways of
maintaining the identity of animals through the
time of slaughter, and for determining the com-
position of the living animal and its carcass. Im-
proved methods of identifying mammalian meat
animals would be a basis for a national record
system. This system would benefit producers,
packers, regulatory agencies, and consumers,
since it could provide information concerned
with marketing, carcass merit, disease, and resi-
due-monitoring programs.
A quick and accurate assessment of body com-
position not only would improve livestock pro-
duction data and marketing procedures, but
would be an example of new technology that
could also be used to address human concerns
about body weight and obesity. Current proce-
dures used for determining body composition
in livestock are too slow, inaccurate, or expen-
sive for adoption by the industry. As a result,
the real value differences between animals of
low and high carcass merit, as affected by fat
content, are normally not fully realized in the
market when animals are sold alive.
The implications of applying these kinds of
technologies for improving the production effi-
ciency, composition, and consumer cost of ani-
mal products are numerous. They include the
more efficient use of livestock feeds, possible
changes in crop production priorities, improved
composition of animal food products, improved
production practices from more complete ani-
mal records, and implications related to human
health. The application of these technologies

will depend on understanding the fundamental
principles or mechanisms involved in each ma-
jor research area.

Animal Nutrition
The U.S. food animal industry is immense.
Food animals provide 70 percent of the protein,
35 percent of the energy, 80 percent of the cal-
cium, 60 percent of the phosphorus, and signif-
icant proportions of the vitamins and mineral
elements in the average human diet in the United
States (Pond, 1985).
The future of this industry will depend not
only on profitability, but also on the industry's
adoption of new technology and on the indus-
try's response to consumer concerns about cost,
esthetics, convenience, and health. Areas of nu-
trition research that may result in major ad-
vances in animal food production and use in
the next 20 years include: 1) the relation of ani-
mal product consumption to human health, 2)
alimentary tract microbiology and digestive
physiology, 3) voluntary feed intake control, 4)
maternal nutrition and progeny development,
and 5) aquaculture.
Many consumers are concerned about the ef-
fect on human health of consuming animal food
products because of the amount and composi-
tion of fat in those products as well as the
amount of sodium, nitrates, and potentially
harmful bacteria or chemical residues. Studies
have suggested strong links between some of
these factors and human cancer, osteoporosis,
and cardiovascular disease. Research on-line
is addressing these concerns by applying nu-
tritional and genetic principles to the improve-
ment of animal food products. For example,
changes in animal fatty acid composition will
be possible by using "protective" feed additives
in specific animal diets. Changes in total ani-
mal fat content will probably occur through
energy restriction, nutrient partitioning, and
genetic selection. Sodium content of animal
products can be reduced at the processing stage.
The direct impact of advances in this area will
be animal food products that are safer for hu-
man health. The indirect impacts may be great-

40 Technology, Public Policy, and the Changing Structure of American Agriculture

er, however: to produce such products, produc-
ers may have to switch to more pasture, forage,
and nonconventional feed resources. Such ad-
justments could change the total profile of agri-
Research into factors controlling voluntary
feed intake and nutrient partitioning will result
in the diversion of the use of nutrients from body
maintenance to lean tissue growth and other
productive functions. Such methods will save
feed and provide opportunities for alternative
uses of feed resources.
More complete knowledge of maternal nutri-
tion in relation to fetal survival and prenatal and
postnatal development may lead to significant
increases in the amount of edible product per
breeding unit. This outcome will be translated
into savings in labor and resource use.
Finally, aquaculture has emerged as an im-
portant new field of animal agriculture in the
United States. Research into specific nutrient
requirements for different species of fish dur-
ing all phases of the life cycle, and interactions
between nutritional requirements and water
environment, will provide new technology that
will make the industry more competitive in ani-
mal agriculture. Future growth of private aqua-
culture will provide an additional supply of edi-
ble fish and shellfish for consumption by the
U.S. population, whose per capital appetite for
animal products may be saturated.

Animal Disease Control
Diseases of livestock are the greatest single
deterrent to the efficiency of animal production
(Osburn, 1985). Together, animal health-related
problems and the resulting inefficiencies in re-
production limit the productive capacity of live-
stock enterprises to 65 to 70 percent of their po-
tential. Although major epidemic diseases such
as foot-and-mouth disease and tuberculosis have
been eradicated or controlled, an estimated $17
billion or more annually is lost in production
because of a variety of infectious diseases, par-
asites, toxins, and metabolic disorders.
Some of these losses result from a lack of un-
derstanding of animal health problems, such as

reproductive inefficiency, neonatal death losses,
or mastitis. Other losses relate to the change in
structure of livestock enterprises to a system
that has both fewer farms and a greater concen-
tration of animals per farm. For example, dairy
operations of up to 5,000 milking cows, and
poultry operations of 100,000 or more birds, are
now relatively common. In these large produc-
tion units the introduction of an infectious dis-
ease can have devastating consequences.
The technologies that show the greatest prom-
ise for improving management schemes and
controlling disease are: 1) data management and
systems analysis, 2) rapid diagnostic tests, 3)
selection for disease-resistant strains of live-
stock, 4) genetic engineering of micro-orga-
nisms and embryos, and 5) immunobiology.
Computers and computer programs already
allow the farm manager to assess the well-being
of each animal in large production units. Data
on feed consumption, vaccination records, and
conception dates, for instance, can be stored
in the computer and retrieved quickly by the
manager or veterinarian. Such systems can be
coordinated with radiotransmitters used to
identify each animal. Within 5 to 10 years such
systems will be widely used by progressive ani-
mal producers.
Advances in biotechnology will include fur-
ther development of animal-side test kits for
rapid assessment of animal health. One of these
tests, the enzyme-linked immunosorbent assay,
can test for hormones (to determine pregnancy),
detect drug residues in milk or feed, and diag-
nose disease (through antibody detection). If
economical tests can be developed, their use will
be widespread and immediate (5 to 10 years).
For certain intractable health problems, like
parasites and mastitis, efforts are being made
to breed disease-resistant strains of livestock.
Advances in embryo transfer, gene insertion
into embryos, and amplification of gene prod-
ucts will increase the number of more desira-
ble offspring by year 2000.
Recombinant DNA technology is already be-
ing used to alter vaccines genetically so that
pathogens in the vaccines cannot replicate in
the inoculant and cause a mild infection that

Ch. 2-Emerging Technologies for Agriculture 41

could spread to other animals. The development
of vaccines for several viral diseases, such as
bluetongue, should be possible in the next 15
Finally, knowledge gained in the past two dec-
ades is being used to improve that system's effi-
ciency. Ingredients adjuvantss) in vaccines are
being used to pace the release of antigens into
the body or to manipulate or favor certain im-
mune responses. In addition, monoclonal anti-
bodies are being used to detect and prevent dis-
ease. The major constraints to the use of these
technologies include: 1) funding of field studies,
2) commercialization of products by the biologi-
cal and pharmaceutical industries, and 3) cum-
bersome and expensive processes for assuring
quality. The benefits of controlling disease will
be a decrease in the cost of production for the
farm operator and a decrease in food cost for
the consumer.
Livestock Pest Control
Major insect pests cause losses to livestock
and poultry of more than $2.5 billion (Camp-
bell, 1985). Some insects, primarily the blood
feeders, are pests of all warm-blooded animals.
Others are host-specific, although related spe-
cies may prey on several classes of livestock.
Losses may be direct, in terms of decreased live-
stock products; or indirect, in the form of insect-
transmitted disease, secondary infections, pre-
disposition to other diseases, irritation that
causes unthriftiness, and costs of insect control.
New technology, particularly for livestock in-
sects that are difficult to control, will be more
expensive and will have a lower cost-benefit ra-
tio than that of current technology. Progress in
new technology in the science of veterinary en-
tomology is relatively slow for the same reason
that adaptation of existing technology is slow-
there are few scientists (60) doing research. Sev-
eral technologies show promise for controlling
insect pests of livestock, however.
Although animal producers will continue to
use insecticides for the immediate future, prog-
ress is being made in such areas as habitat man-
agement (pasture rotation and brush control for
ticks); integrated pest management biocontroll,

sanitation, and waste management for fly con-
trol at feedlots and dairies); and use of pest-
resistant breeds in cross-breeding programs (In-
dian crossed with European cattle).
For blood-feeding insects research is directed
at developing slow-release technology, whereby
a chemical ingredient is formulated into a ma-
trix that slowly erodes or vaporizes to release
insecticide. For example, insecticide boluses are
used in the stomach of animals, where they
slowly release insecticide that destroys manure-
developing fly larvae. Insecticide can also be
implanted in an animal's body. Eartags impreg-
nated with a slow-release insecticide have been
very effective for horn fly control and have im-
proved face fly control in cattle. As the insecti-
cide vaporizes, it spreads over the haircoat of
the animal, destroying insects that rest or feed
on the animal. (However, horn fly resistance
to the pyrethroid insecticides used in eartags
has become widespread.) The newest of these
technologies are implants that directly release
insecticide into the bloodstream, destroying
blood-feeding insects. However, implants and
boluses will have a limited effect for migratory,
blood-feeding insects unless many producers
join the control effort.
Recombinant DNA technologies will be used
for the molecular cloning of desired antigens,
toxins, enzymes, or other biologically impor-
tant molecules for use as research tools or in
the development of vaccines for bluetongue,
anaplasmosis, and other diseases for which in-
sects are vectors. In addition, this technology
will enhance the study of molecular genetics
and metabolic control in Bacillus thuringien-
sis, a bacterium pathogenic to some insects.
Advances in genetics will allow scientists to
manipulate the reproductive capabilities of pest
species. These advances include the sterile in-
sect release method and chromosomal trans-
location, among others.
If technology already available were used on
a wider scale, livestock losses from insects could
be reduced by one-third ($700 million). This out-
come would entail at least a doubling of cur-
rent extension efforts in livestock entomology.
The new methodology discussed might reduce

42 Technology, Public Policy, and the Changing Structure of American Agriculture

losses by another 15 to 25 percent, but at a lower
cost-benefit ratio.

Environment and Animal Behavior
The effects of environment on animal well-
being have become ever more important be-
cause of the trend toward production systems
that confine a large number of animals together
in a more artificial environment (Curtis, 1985).
Confinement simplifies the environment, reduc-
ing an animal's opportunities to alter its sur-
roundings to advantage. While such intensive
systems increase production per unit of labor
input or space, they can be detrimental to ani-
mal function and performance.
The advent of intensive production systems
changed the relative importance of various envi-
ronmental factors as well as the strategies for
improving animal production through the appli-
cation of technology. New technologies likely
to emerge by 2000 as a result of current research
lie in the areas of energy conservation, optimi-
zation of total stress, stress-altered disease re-
sistance, and photoregulation of physiological
Feed and fuel-sources of energy-account
for much of the cost of animal production. Al-
though the trade-offs between feed and fuel have
been quantified for most species, the integra-
tion of additional research will result in further
energy savings. For example, environmental
temperature management schemes developed
in an era of cheaper fuel are too luxurious today.
Animal producers tend to maintain constant
environmental temperatures for their stock,
even though the animals evolved in the cycli-
cal thermal environment of nature. In one ex-
periment, when young pigs were allowed to reg-
ulate their own environmental temperatures,
they inserted a daily 20 F fluctuation of warm
afternoons and cool nights, resulting in un-
changed pig performance but a 50-percent reduc-
tion in fuel use during cold weather. Lowering
thermostat settings to parallel age-dependent
changes in thermal requirements has also been
found to save fuel. In some cases cooler sur-
roundings spur appetites, so performance ac-
tually increases. Cost-effective, low-mainte-

nance designs of heat exchangers and solar heat-
ing systems will affect further energy savings.
Either too much or too little environmental
stimulation can have deleterious effects on the
performance, health, and well-being of agricul-
tural animals. To optimize total stress, more
must be learned about how stress acts on and
is perceived by animals. Devices that animals
can use to regulate certain environmental fac-
tors are already being recommended to farmers.
Computerized sensing devices and control
equipment will make biofeedback-linked auto-
mation of environmental regulation a reality in
animal agriculture.
Researchers are also investigating how the
environment influences specific mechanisms
of immunity to disease. A variety of common
environmental stressors-temperature, crowd-
ing, mixing, weaning, limit-feeding, noise, and
movement restraint-are known to alter ani-
mals' defenses against infectious agents. New
techniques in basic science, coupled with more
traditional neurobiological, endocrinological,
and immunological approaches, can yield a bet-
ter understanding of how stressors influence
regulatory signals among lymphoid cell sub-
The regulation of light is of particular inter-
est in animal production. The advent of photo-
period management revolutionized the poultry
industry 40 years ago. Light is managed in poul-
try confinement operations so that it stimulates
poultry growth. In the last two decades the ef-
fects of photoperiod management have also
been characterized for sheep reproduction. Al-
though the results of similar studies on cattle
and swine have been less definitive, some re-
sults have been encouraging: under controlled
lighting, sows weaned heavier piglets, cows
yielded more milk, and lambs grew faster. Ex-
periments now in progress will produce infor-
mation immediately applicable to animal pro-
Crop Residues and Animal Wastes
Improved use of crop residues and animal
wastes represents a tremendous potential for
more efficient use of resources (Fischer, 1985).

Ch. 2-Emerging Technologies for Agriculture 43

Livestock on U.S. farms produce about 55 mil-
lion tons of recoverable manure. Approximately
363 million tons of crop residues are produced
annually in the United States. Several technol-
ogies and major lines of research and develop-
ment exist in this area: 1) energy from manure,
2) animal feed from manure, 3) chemicals from
crop residues, and 4) animal feeds from crop
The high volume of manure production that
occurs at many large feedlots and dairies is an
opportunity in disguise. Manure has value both
as a soil additive and as a source of energy for
heat and electricity. Traditionally, manure has
been either applied to the soil surface in an un-
processed form or disposed of in a sewage la-
goon. Application of manure to the soil surface
creates environmental problems in many areas
and results in a loss of up to 90 percent of the
useful nitrogen value of the manure. Technol-
ogy is available to inject the manure below the
soil surface, resulting in only a 5-percent loss
of nitrogen (Suttan, et al., 1975).
Large farms may benefit from installing an-
aerobic digesters to produce methane from ma-
nure, for use as a heating fuel or as a substitute
for propane in electric generators. The slurry
that remains after digestion contains most of
the original nutrient value and may be applied
to cropland as fertilizer. Injection of the slurry
is preferred, since most of the nitrogen after
digestion is in the form of ammonia.
In many farm operations, it is profitable to
process manure and use it as a source of non-
protein nitrogen and fiber in cattle and dairy
cow rations. Manure is a low-cost source of nu-
trients, and reusing it as feed reduces the vol-
ume of animal wastes that must be processed
or disposed of. If used for cattle feed, manure
must first be concentrated, then processed by
heat treatment or by ensiling.
Using crop residues as a source of chemical
feedstocks and animal feed involves some com-
plex trade-offs in most areas because crop resi-
dues are becoming widely valued for their abil-
ity to reduce soil erosion in combination with
conservation tillage practices. Even when crop

residues are completely tilled into the soil, they
have significant value in maintaining soil struc-
ture and nutrient content. However, useful
amounts of residues may be removed from fields
in many parts of the United States where
cropland slopes are gentle and residue density
is high. The cost of transporting bulky crop
residues generally constrains the area over
which collection is economically feasible.

Several technologies under development have
promise in areas where residue collection is eco-
nomically feasible. Residues may be broken
down into their component parts by mechani-
cal, chemical, or biological processing, or a com-
bination of all three. The principal components
of crop residues are lignin, hemicellulose, and
cellulose. Lignin can be used to produce solvents
such as benzene, toluene, and xylene. Hemicel-
lulose is readily converted into furfural, which
is, in turn, a feedstock for the production of nu-
merous chemicals. Plastic films and fibers and
the simple sugar, glucose, can be produced from
cellulose. Production of these chemicals is likely
to require moderately large-scale technology
based on industrial processes and equipment.
Transportation costs reduce the likelihood that
crop residues will be used as feedstock for in-
dustrial processing. Some farms may adopt di-
rect combustion of crop residues for use as a
source of heat for grain drying.

In the near term, the most likely process for
conversion of crop residues is biological: rumi-
nant animals. Most crop residues can be fed
directly to ruminant animals as a source of
roughage. A substantial potential exists for de-
veloping technologies to increase the palatabil-
ity and digestibility of crop residues. Numer-
ous efforts have been made to develop simple
mechanical and chemical pretreatments, with
some success. The problem is difficult, owing
to the degree with which the digestible hemicel-
lulose and cellulose are bound to the nondigest-
ible lignin component in the residues of mature
cash grain crops. Additional research and de-
velopment leading to economic and effective
pretreatments would have substantial benefits
because the size of this resource is so large.

44 Technology, Public Policy, and the Changing Structure of American Agriculture

Plant Genetl Engrineorlng
Biotechnology is not new to plant agriculture
(Fraley, 1985). Plant breeding, agrichemicals,
and microbial seed inocula have made major
contributions to the remarkable development
of American agriculture. Within the last dec-
ade, major advancements have been made in
the understanding of gene function and archi-
tecture, and powerful methods have been de-
veloped for identifying, isolating, and modify-
ing specific DNA segments.
The further application of biotechnologies in
plant agriculture could modify crops so that they
would make more nutritious protein, resist in-
sects and disease, grow in harsh environments,
and provide their own nitrogen fertilizer. While

Photo credit: U.S. Department of Agriculture, Agricultural Research Service
Plant geneticist is determining the structure of a soybean
DNA segment that resembles the movable genetic
elements first discovered in corn. Each band represents
a "letter" or nucleotide, in the genetic code.

the immediate impacts of biotechnology will be
greater for animal agriculture, the long-term im-
pacts may be substantially greater for plant
agriculture. The potential applications of bio-
technology on plant agriculture will include
microbial inocula, in vitro plant propagation
methods, and genetic modification.

Microbial Iaocula
Research on plant-colonizing microbes has
led to a much clearer understanding of their role
in plant nutrition, growth stimulation, and dis-
ease prevention, and the possibility exists for
their modification and use as seed inocula. Rhi-
zobium seed inocula are already widely used
to improve nitrogen fixation by certain plants
(legumes). Extensive study of the structure and
regulation of the genes involved in bacterial ni-
trogen fixation will likely lead to the develop-
ment of more efficient inocula.
Two years ago, scientists at the University of
California, Berkeley, genetically engineered ice-
nucleation bacteria that inhibit frost formation
in potato plants. To form ice, there must be nu-
cleation sites around which the water molecules
can form the regular ice structure. In the eco-
sphere, this role is performed by specialized bac-
teria called Pseudomonas syringae, which con-
tain specific proteins that act as the nucleation
centers for the growth of ice crystals. By coloniz-
ing plants in the manner of epiphytes,5 these
bacteria induce ice formation and thus cause
frost damage to plants as the temperature drops
below freezing (Feldberg, 1985).
Scientists constructed a new strain of bacte-
ria in which the nucleation protein is absent or
altered so that the bacteria can no longer play
the role of nucleation centers. Having success-
fully constructed a new strain of bacterium,
these researchers were ready to field test this
new organism to see if it would outcompete the
normal strains. If so, the new bacterium would
protect crops from frost damage, and millions
of dollars in lost crops would be saved. As the

5Plants that derive their moisture and nutrients from the air
and rain and that usually grow on another plant. Spanish moss
is an epiphyte.

Ch. 2-Emerging Technologies for Agriculture 45

novel bacteria were scheduled for release to the
field, a coalition of public interest groups filed
a lawsuit to postpone the field trials (see chap-
ter 10 for more detailed discussion about this

Recently, Monsanto announced plans to field
test genetically engineered soil bacteria that pro-
duce naturally occurring insecticide capable of
protecting plant roots against soil-dwelling in-
sects (House Committee on Science and Tech-
nology, 1985). The company developed a genetic
engineering technique that inserts into soil bac-
teria a gene from a micro-organism known as
Bacillus thuringiensis, which has been regis-
tered as an insecticide for more than two dec-
ades. Plant seeds can be coated with these bac-
teria before planting. As the plants from these
buds grow, the bacteria remain in the soil near
the plant roots, generating insecticide that pro-
tects the plants.

Plant Propagation
Cell culture methods for regenerating intact
plants from single cells or tissue explants are
being used routinely for the propagation of sev-
eral vegetable, ornamental, and tree species
(Murashige, 1974; Vasil, et al., 1979). These
methods have been used to provide large num-
bers of genetically identical, disease-free plants
that often exhibit superior growth and more uni-
formity over plants conventionally seed-grown
(figure 2-5). Such technology holds promise for
important forest species whose long sexual cy-
cles reduce the impact of traditional breeding
approaches. Somatic embryos produced in
large quantities by cell culture methods can be
encapsulated to create artificial seeds that may
enhance propagation of certain crop species.

eEmbryos reproduced asexually from body cells.

Figure 2-5.-Plant Propagation--From Single Cells to Whole Plants
The process of plant regeneration from single cells in culture

Cell multiplication


Desired plant



Field performance tests

Cell wall


Exposure to
selection pressure,
e.g., high salt

Roots and

+ Root-promoting

Surviving cells
go on to form callus

SOURCE: Office of Technology Assessment.

46 Technology, Public Policy, and the Changing Structure of American Agriculture

Genetic Modification
Three major biotechnological approaches-
cell culture selection, plant breeding, and ge-
netic engineering-are likely to have a major
impact on the production of new plant varieties.
The targets of crop improvement via biotech-
nology manipulations are essentially the same
as those of traditional breeding approaches: in-
creased yield, improved qualitative traits, and
reduced labor and production costs. However,
the newer technology offers the potential to
accelerate the rate and type of improvements
beyond that possible by traditional breeding.
Of the various biotechnological methods that
are being used in crop improvement, plant ge-
netic engineering is the least established but the
most likely to have a major impact. Using gene
transfer techniques, it is possible to introduce
DNA from one living organism into another,

regardless of normal species and sexual barriers
(figure 2-6). For example, it has been possible
to introduce storage protein genes from French
bean plants into tobacco plants (Murai, et al.,
1983) and to introduce genes encoding photo-
synthetic proteins from pea plants into petunia
plants (Broglie, et al., 1984).

Transformation technology also allows the in-
troduction of DNA coding sequences from vir-
tually any source into plants, providing those
sequences are engineered with the appropriate
plant gene regulatory signals. Several bacterial
genes have now been modified and shown to
function in plants (Fraley, et al., 1983; Herrera-
Estrella, et al., 1983). By eliminating sexualbar-
riers to gene transfer, genetic engineering will
greatly increase the genetic diversity of plants.
This technology will have a major impact on
the seed and plant production industries as well

Figure 2-6.-Gene Modification-Insertion of a Desired Gene Into the Host Plant Through Vectors
(or gene taxis)
/I tumefaciens
\ Plant DNA
/ \\
// \ Bacteria
DNA plasmid

Designed gene

rDNA plasmid

Bacterium with
(^ --0 functional plant

Infect host plant

SOURCE: Office of Technology Assessment.

Ch. 2-Emerging Technologies for Agriculture 47

as on the chemical, food processing, and phar-
maceutical industries.
The commercialization of plant biotechnol-
ogy will require breakthroughs in several tech-
nical areas, including increased understanding
of plant cell culture, plant transformation sys-
tems, plant gene structure and function, the
identification of agronomically useful genes,
and plant breeding. Increased research fund-
ing is needed in these specific areas and gener-
ally in the basic plant sciences and in molecu-
lar biology to accelerate technical development.
Commercialization of plant biotechnology will
also depend on other factors, including envi-
ronmental regulation, university-industry rela-
tions, economic incentives, and consumer ac-
Improved plants produced by gene transfer
methods should be commercially available in
7 to 10 years. The introduction of plants
produced and selected using cell culture manip-
ulations and certain biotechnology-derived mi-
crobial seed inocula or products could occur
Plant genetic engineering methods will ini-
tially emphasize the same targets for crop im-
provement (increased yield, improved qualita-
tive traits, and reduced labor and production
costs) as traditional breeding programs do. Ulti-
mately, the technology will lead to improve-
ments not even imagined in American agri-

Enhancement of
Photosynthetic Efficiency
Photosynthesis is the fundamental basis for
plant growth (Berry, 1985). Through photosyn-
thesis, energy from sunlight is absorbed by
chlorophyll-containing tissues of the plant and
used to assimilate carbon dioxide into organic
molecules. The photochemical reactions in the
process are intrinsically very efficient. How-
ever, several factors inhibit photosynthetic effi-
ciency in plants: 1) certain mechanisms of pho-
tosynthesis itself, 2) the efficiency of water and
nutrient use, and 3) environmental stress. Re-
search is ongoing in each of these areas.

Plants vary in their efficiency of photosynthe-
sis. Higher plants have an enzyme (RuBP car-
boxylase) that causes oxygen to react in a side
reaction during photosynthesis, diverting en-
ergy that would otherwise be used to fixate car-
bon dioxide. This oxygenase reaction, which
appears to result from a metabolic defect in
plants, is encouraged by the high-oxygen, low-
carbon dioxide concentration of normalair. Ar-
tificially increasing the content of carbon di-
oxide in the air partially suppresses this mech-
anism and generally results in increased crop
yields. This suggests that improvements in the
mechanism of photosynthesis could result in
increased yields, all else being equal.
Plants known as C4 plants have developed a
biological and morphological modification that
reduces the impact of the oxygenase reaction.
As a result, they waste less energy during pho-
tosynthesis. C4 plants include corn, sorghum,
sugarcane, and millet. Plants that cannot sup-
press the oxygenase reaction are called C3
plants. They include wheat, soybeans, cotton,
and rice.
C4 plants have an advantage over C3 plants
when leaf temperatures are high and a disadvan-
tage when they are low. Moreover, C4 plants
use nitrogen and water more efficiently in pho-
tosynthesis. Thus water use efficiency could be
increased in warm, arid regions if more C4
plants could be used.
A long-term prospect for improving photosyn-
thetic efficiency lies in research to understand
the basis for the oxygenase reaction and efforts
to inhibit the reaction chemically or to modify
the enzyme by using rDNA technology. Success
will depend on many breakthroughs in under-
standing the chemistry and molecular biology
of chloroplasts and in manipulating chloroplast
Molecular biology has already yielded the abil-
ity to modify the sequence of amino acids in
RuBP carboxylase to produce modified versions
of the protein. This provides experimental tools
of unimagined power for investigating the
mechanisms of enzyme-catalyzed reactions.
Other research is being directed at improving
the efficiency of use of water and nutrients

48 Technology, Public Policy, and the Changing Structure of American Agriculture

through: 1) better management techniques that
use microcomputer-based plant growth models,
and 2) new instrumentation to monitor crop per-
formance. Improved weather forecasting will
also be important. Breeding plants for efficient
water and nutrient use and for stress resistance
is possible and has already had some impact.
These technologies have the greatest immedi-
ate prospect for improving the efficiency of pho-
tosynthesis in the next decade, although a strong
research effort is needed to realize these po-

Plant Growth Regulatrs
Plant growth regulators are natural or syn-
thetic compounds that are applied (usually di-
rectly) to a plant to alter its life processes or struc-
ture in order to improve quality, increase yields,
facilitate harvesting, or any combination of
these (Nickell, 1985). Used commercially since
the 1920s, plant growth regulators have had a
variety of impacts. One of their earliest was in
rooting powders and solutions for the propaga-
tion of cuttings. Another was the use of maleic
hydrazide to prevent sprouting in potatoes and
onions during storage.
The biggest boost to plant growth regulation
came with the discovery that phenoxyacetic
acids kill broadleaved plants (such as weeds)
but not grasses. Using such chemicals in herbi-
cides has out distanced economically all other
uses of plant regulators and, until recently,
dwarfed their general importance.
Overall research on plant growth regulation
is currently multipronged. Industrial research
is particularly directed at two major U.S. crops-
corn and soybeans.
An increasingly important research effort is
that for antidotes to herbicides. Called protec-
tants, or safeners, such compounds can be ap-
plied to the crop, usually to the seed, to make
it resistant to an herbicide. When the herbicide
is applied to the crop row, it kills only the weeds.
USDA has used plant growth regulators so
successfully in the guayule bush that it may be
theoretically possible to have a rubber indus-
try within the boundaries of the United States.

Photo credit: Jonn c(arner, rignam Young university
Scanning electromicrograph of a developing wheat head
reveals vertebrae-like spikelets branching from its axis.
By unlocking the hormonal secrets locked in the tissue
of the spikelets, researchers hope to increase the number
of spikelets per head, and the number of kernel-producing
florets on each spikelet-thus increasing yield.

Ethephon, which is used to prevent coagulation
of latex flow in rubber trees, eliminates the need
to tap the tree daily. Plant growth regulators of
the triethylamine type are used to increase the
total rubber content of the guayule bush. A sim-
ilar use of growth regulators is the use of para-

Ch. 2-Emerging Technologies for Agriculture 49

quat on pine trees. The result is a significant
increase in oleoresin content and the possibil-
ity that the naval store industry may take on new
life in the Southeast United States.
The success in the sugarcane industry in the
control of flowering, in the use of gibberellic
acid to increase the tonnage of both cane fiber
and sugar, and in the use of ripeners to enhance
sugar yields allows industry to turn its atten-
tion to developing dessicants for use as harvest
In the grape industry the successful use of gib-
berellins on grapes is stimulating studies on the
control of abscission (the shredding or separat-
ing of plant organs such as fruit or leaves) and
the use of ripeners to increase sugar content.
Abscission agents have been used successfully
on cotton, oranges, cherries, and olives, where
it reduces the tenacity of the fruit sufficiently
to allow easy harvest by hand-picking, mechan-
ical harvest, or shaking. Abscission agents have
also been used to thin apple blossoms, chang-
ing the yield pattern from alternating light-
fruiting and heavy-fruiting years to annual, suc-
cessfully bearing years.
Plant growth regulators can reduce harvest-
ing costs by changing the shape of the whole
plant or just its fruit to allow easier mechanical
harvesting. Apples, grapes, and wheat are ex-
amples. Gibberellic acid is used with grapes,
for instance, to lengthen the pedicel to each
berry. This reduces the rotting that normally
occurs because grapes grow too close together.
The size and shape of both apples and grapes
can be changed by cytokinins and gibberellic
Regulators can also be used to speed or delay
the maturation of fruit. Success has already been
notable with navel oranges and with pineapple,
peppers, cherries, coffee, tomatoes, and tobac-
co. In addition, the tremendous losses of food
crops following harvest almost guarantees an
increase in research to develop preharvest and
postharvest preservation through plant growth
Finally, preliminary indications with Cycocel
and other chemicals suggest that overcoming

environmental limitations via plant growth reg-
ulators should be a fertile field for investigation.
A substantial number of new products or new
uses for existing products can be expected in
the 1990s. Because of the difficulty in register-
ing new compounds, many of the advances will
be extensions of uses of existing products. Since
so much of the chemistry, evaluation, and ex-
pensive toxicology has already been done on
existing products, finding new uses for those
products might well have a greater impact than
researching new compounds.

Plant Disease and Nematode Control
Plant diseases are caused by viruses, fungi,
bacteria, nematodes, and other micro-orga-
nisms (Browning, 1985). Collectively, these
organisms cause considerable losses before and
after harvest, an estimated $18.6 billion annu-
ally. Only a few of the thousands of species of
pathogens and insects cause concern, however;
the rest are controlled by natural immunity.
Many organisms that do cause loss may theo-
retically be controlled by managing more wisely
the mechanism of host-plant resistance. This
area is a major one for research.
Some beneficial micro-organisms help pro-
tect plants from disease. In addition to their
nutritional benefits, nodulating bacterial and
mycorrhizal (root-extending) fungi render some
plants more disease resistant. Micro-organisms
also provide a vast gene pool for improving
plants and other micro-organisms through rDNA
technology. That technology is already avail-
able for synthesizing microbes of naturally oc-
curring products for use as pesticides. Such ge-
netic engineering should lead to new biocontrol
agents; for example, modified plant viruses that
will give cross protection. One success story is
that of crown gall, a serious bacterial disease
of many woody and herbaceous plants. Crown
gall is now controlled biologically by the K84
strain of bacterium that is a close relative of the
bacterium that causes the disease. Inoculating
a seed or transplant with K84 produces a bac-
teriocin that protects against crown gall.

50 Technology, Public Policy, and the Changing Structure of American Agriculture

Photo credit: U.S. Department of Agriculture, Agricultural Research Service
Golden nematode cysts (about 0.5 mm long) on the roots
of a potato plant.

Other examples of biocontrol include using
disease-suppressive soils and pasteurizing the
soil to kill pathogens but not thermophilic (grow-
ing at high temperatures), beneficial microbes.
In addition, some cultural practices (fertiliza-
tion, irrigation, and stubble and debris manage-
ment) can be refined to effect biocontrol. For
example, continuous cropping can be used to
allow antagonists to pathogens to increase, as
in the control of potato scab.
Disease-resistant cultivars can be bred and
resistance-managed. Genetically, plant resis-
tance is conditioned by major-effect genes and
minor-effect genes. Although major-effect genes
are easier to work with and give more dramatic
results, their effectiveness in the field has fre-

quently been disappointing. Thus researchers
have turned to minor-effect genes, which are
more difficult to work with but are the most suc-
cessful way of controlling disease in the homo-
geneous cultivars demanded by mechanized
Western agriculture. Major-effect genes show
promise for controlling disease in hetero-
geneous cultivars, as occurred with multiline
oat and wheat cultivars developed in Iowa and
Washington. Even highly epidemic foliar path-
ogens can be controlled in this manner. A major
line of research may result in using resistance
genes to obtain diversity without sacrificing
bona fide needs (as opposed to merely cosmetic
needs) for uniformity. This may be one of the
fastest ways simultaneously to control certain
highly epidemic diseases and to reap the tremen-
dous potential benefits from plant genetic engi-
Additional work is needed at all levels of pes-
ticide development, but is especially needed for
completing the development of systemic pesti-
cides that have two sites of activity on the mole-
cule, thereby extending the pesticide's effective
life. Research is also needed on more effective
delivery systems for systemic pesticides.
Other research will be directed to develop-
ing naturally occurring chemicals that will stim-
ulate the plant's defense mechanisms or en-
hance activity by biocontrol agents. Ultra-low-
volume delivery systems will be needed for these
and regular pesticides that are active at very low
A final important area for research is that of
crop loss assessment. Although it is possible to
assess plant loss from single pathogens, weeds,
and arthropods (and a few combinations of
these), such assessments are less precise when
made for larger areas, several cultivars, and a
wide variety of plant stresses. Research to im-
prove crop loss assessment will help set research
priorities and aid in making management de-

Management of las eft and Mftes
Insects and mites are humankind's greatest
competition for food and fiber (Kennedy, 1985).

Ch. 2-Emerging Technologies for Agriculture 51

Although less than 1 percent of all insect and
mite species are considered agricultural pests,
those pests cause average annual losses to agri-
cultural production of 5 to 15 percent, despite
the expenditure of millions of dollars each year
for agricultural pest control. Thus, protecting
crops from such losses will continue to be an
important component of agricultural pro-
Research on this problem is being conducted
in the broad areas of: 1) chemical controls for
insects and mites, 2) genetic manipulation of
plants and insects and their natural enemies,
and 3) information processing.
Because they are highly effective, economi-
cal, and fast acting, chemical insecticides and
acaricides (for mites) are widely used for reduc-
ing insect and mite populations to subeconomic
levels. Advances in insect physiology, toxicol-
ogy, and analytical chemistry are leading to the
discovery of new compounds that disrupt the
normal growth and development processes of
insects. Compounds with juvenile hormone ac-
tivity that prevent an insect from molting to the
adult stage, those with antijuvenile hormone
activity that cause insects to molt prematurely
to the adult stage, and those that interfere with
the normal synthesis and deposition of exoskele-
ton all hold promise for the future. Similarly,
advances in the chemistry of natural products
and the study of plant defenses against insects
and mites are leading to the identification of
naturally occurring, insecticidal and acaricidal
compounds with novel modes of action. Many
such compounds are likely to be suitable for
large-scale production via fermentation proc-
esses with genetically engineered micro-or-
With existing application technology only 25
to 50 percent of a pesticide is actually depos-
ited on plant surfaces, and less than 1 percent
actually reaches the plant. In addition to being
wasteful, this situation greatly exacerbates un-
desirable effects to the environment. One fac-
tor is the incorrect mixing and calibration by
pesticide applicators. Efforts are thus being
made to design equipment that injects pesticides
at the proper rate directly into the lines carry-

-ornul u .0. uLp.s.WIr or AgrcuIIur, Agrncurlural nesearcn service
A Mexican bean beetle larva-a devastating pest of snap
and soybeans-becomes a meal for the spined soldier
bug Instead. The bug's pheromone may help farmers
enlist its help in controlling many pest insects.

ing water to the nozzle, eliminating the need
for tank mixing. Other research will ensure
more uniform droplet size, will control spray
drift, and will improve adherence of the spray
to the plant.
Advances in genetic engineering greatly in-
crease the likelihood of new classes of insecti-
cides and acaricides. Insect pathogens, includ-
ing bacteria, fungi, protozoa, and viruses, are
likely candidates for genetic engineering to en-
hance their utility as microbial insecticides. The
pathogenic bacterium Bacillus thuringiensis is
already commercially available and widely used
to control caterpillars on certain crops. Genetic
engineering holds great promise for expanding
the spectrum of pests controlled by this bac-
Crop varieties resistant to insect pests have
been used to manage insects with success in a

52 Technology, Public Policy, and the Changing Structure of American Agriculture

number of important crops. Use of genetic engi-
neering to transfer genes from resistant wild
plants to crop cultivars holds great potential for
insect and mite management, but requires very
specific knowledge of the biochemical bases of
the resistance crop to be transferred. In most
cases, the requisite knowledge is not yet available.
Improvements in the design and availability
of computer hardware and software will pro-
duce tremendous changes in insect and mite
management at the research, extension, and
farm levels. To contribute to crop profitability,
insect and mite management entails the proc-
essing of tremendous amounts of information
on the condition and the phenological stage of
the crop, the status of insects and mites and their
enemies in the crop, incidences of plant diseases
and weeds and measures used in their control,
weather conditions, crop production inputs,
and insect and mite management options. Com-
puters at the farm level, with access to central-
ized databases, will allow farm operators to de-
sign and implement pest management strategies
for their farms. Some software systems are al-
ready in place and are continually being im-
proved. In general, however, improvements in
databases are awaiting advances in knowledge
about pest dynamics and crop pest interactions.

Biological Nitrogen Fixation
Nitrogen is a critical nutrient for crop pro-
duction (Alexander, 1985). Although abundantly
available-either as atmospheric nitrogen (N2)
or in organic complexes in the soil-nitrogen
in these forms cannot be used directly by plants.
It must first be changed to ammonia (NH,) or
nitrate (NO3). Thus the large supply of nitrogen
needed to grow crops is most commonly pro-
vided by nitrogen fertilizers. However, such fer-
tilizers are expensive, and their production con-
sumes a nonrenewable resource, hydrocarbons.
Nitrogen can also be provided through bio-
logical nitrogen fixation, a process by which cer-
tain bacteria and blue-green algae use an en-
zyme, nitrogenase, to convert N2 to NH3. The
most important of these bacteria agriculturally
belong to the genus Rhizobium. These bacteria

Photo credit: Howard Berg, University of Florida
A scanning electron micrograph of a root tip from a
sorghum (Sorghum bicolor) plant with kidney bean
shaped bacteria (Azospirillum brasilense) on its surface.
Such nitrogen-fixing bacteria may live on the root surface
or in the surrounding soil. The white, threadlike
projections are root hairs.

enter the roots of legumes and form nodules in
which they "fix," or convert, nitrogen in the air
to forms used by plants. A legume may receive
all of its nitrogen needs this way, given the right
Rhizobium. In turn, the rhizobia are somewhat
protected from microbial competition and pre-
dation and from other detrimental effects in the
soil environment.
Other kinds of nitrogen-fixing bacteria live
near cereal crops and grasses, possibly provid-
ing small, beneficial amounts of nitrogen to the
plants and receiving needed organic compounds
but no protection from detrimental effects in

Ch. 2-Emerging Technologies for Agriculture 53

return. This relationship is known as associa-
tive fixation.
If its magnitude can be increased, the proc-
ess of biological nitrogen fixation offers an at-
tractive way to supply the large nitrogen de-
mand of crops without the extensive use of
nitrogen fertilizers. To this end, considerable
research has been done in the last decade on
the biochemistry and genetics associated with
the process, and much useful information has
been gleaned from this basic research. Research
is also under way to determine the possibility
of developing cereal crops that fix their own
nitrogen, and recent studies have provided
needed approximations of the amount of nitro-
gen provided by associative fixation.
To provide enough nitrogen biologically to
sustain high crop yields, however, the stresses
affecting legumes and rhizobia must be better
understood, and improved bacterial strains and
other ways to overcome these constraints must
be found. These developments will come from
a combination of well-established techniques
and agronomic practices as well as new tech-
nologies. For example, conventional strain se-
lection and genetic manipulation may be used
to produce strains of rhizobia that can compete
with soil micro-organisms or that can resist abi-
otic stresses such as pesticides, drought, and
high temperatures. Plant breeding will be used
to develop legumes that are better acclimated
to soil conditions, have greater photosynthetic
activity and less photorespiration, can resist
nodulation by less effective soil rhizobia in fa-
vor of inoculated rhizobia, and can prolong the
duration of fixation. Less likely to come to frui-
tion in this century, but of great importance,
will be the development of cereals that can fix
their own nitrogen in their tissues or root zones.
If funding is adequate, greater nitrogen fixa-
tion from legume-bacterial symbiosis will be
realized in the next 10 years, and that from the
associative fixation of cereal roots will be real-
ized in 15 years. The benefits of these and fu-
ture improvements will be the reduced use of
hydrocarbons for fertilizer production, an in-
crease in the availability of fertilizer worldwide,
and less contamination of ground water.

Water and Soil-Water-Plant
The distribution of vegetation over the Earth's
surface is controlled more by the availability
of water than by any other factor (Boersma,
1985). In the United States, agriculture accounts
for over 80 percent of the water consumed;
about 98 percent of that water is used for irri-
gation of crops, particularly in the more arid
Western States. Several factors complicate the
availability of water for irrigation: 1) cities, in-
dustry, and farming are in fierce competition
for the water available; 2) ground-water sources
are gradually being depleted; 3) the costs of
pumping and distributing surface water are
gradually increasing; and 4) many surface and
groundwaters are being contaminated by a va-
riety of pollutants. Thus techniques to conserve
adequate supplies of fresh water have become
Many important contributions have been
made by studying water requirements of crops.
Although this information has helped in plan-
ning reservoir and canal sizes, the hope for
breeding plants with lower requirements for
water has not been realized, and no technologies
have been advanced that would help realize this
goal in the next 15 years. Nearly all improve-
ments in water use efficiency have come from
improved irrigation techniques, especially the
timely application of the amount of water
needed and application in a manner that mini-
mizes evaporation. (At present, nearly all the
water taken up by the plant is immediately
passed through and evaporated at the leaf sur-
faces. Only a very small fraction becomes part
of the plant's permanent structure.)

Progress in improving the water use efficiency
of crops will hinge on gathering the informa-
tion needed to develop a theoretical framework
of the mechanisms that influence uptake, use,
and loss of water-in humid regions as well as
arid and semiarid regions. Dramatic progress
in the development of instrumentation now per-
mits researchers to measure many plant phys-
iological responses in real time. It also allows
the recent measurements of plant hormones and

54 Technology, Public Policy, and the Changing Structure of American Agriculture

Br' 7

Photo credit: U.S. Department of Agriculture, Agricultural Research Service
California cotton fields are the testing grounds for this
laser-aligned traveling trickle irrigation system, which
links traveling and trickle concepts to improve irrigation
efficiency for row crops. Here, wheel towers-operating
laterally from a concrete-lined irrigation canal-
carry a water line across the field.

enzymes, which provide additional indications
of water stress.
Once the mechanisms of water use efficiency
have been identified and a better understand-
ing of the plant as an integrated whole is gained,
biotechnology may help in the development of
more water-efficient plants. Already, recent ex-
periments suggest that tissue culture may pro-
vide material less susceptible to water stress.
For example, alfalfa and rice cell lines have been

obtained that tolerate 2 percent sodium chlo-
ride, a salt concentration lethal to nonselected
For the near term, however, traditional meth-
ods of plant breeding must be relied on, even
though there is increasing evidence that for
many crops the limits to improvement by this
method are being approached. To break through
this yield plateau, the breeder must work with
the physiologist and biochemist to understand
the stress response hierarchy and eventually to
control enzymes, membrane characteristics,
and mechanisms for communication in the
The technologies available for immediate ap-
plication are those that prevent losses in trans-
port, particularly those for farm distribution of
irrigation water. These include drip irrigation,
below-ground distribution of water, deficit ir-
rigation, water harvesting, time and frequency
of application, and the forecasting of time and
frequency of application.7

Land Muangement
Land is one agricultural resource that cannot
be replaced. Thus a variety of methods and tech-
nologies have been developed to conserve soil
while increasing yields. These land manage-
ment technologies include conservation tillage,
controlled traffic farming, custom-prescribed
tillage, multicropping systems, and organic
Conservation tillage is a tillage and planting
system that leaves 30 percent of the crop resi-
due on the soil after planting. The use of the
various forms of this system has increased at
over 13 percent annually from 1972 to 1982. The
specific system used depends on local crops,
soil type, moisture levels, and pest infestation,
among other factors. Most conservation tillage
methods eliminate the use of the moldboard
plow, using instead chisel plows or heavy disks
in conjunction with heavy-duty planting equip-
ment to cut through soil residues. Mulch-till

'For more information on this area see the OTA study Water-
Related Technologies for Sustainable Agriculture in U.S. Arid/
Semiarid Lands, 1983.

Ch. 2-Emerging Technologies for Agriculture 55

Photo credit: U.S. Department of Agriculture, Agricultural Research Service
Facilities at the National Tillage Machinery Laboratory include nine outdoor and two indoor soil bins for evaluating
tillage and traction machinery concepts in various soil conditions.

equipment, for example, entails using wide
sweeps and blades up to 30 inches wide to cut
horizontally several inches below the soil sur-
face. The process loosens and aerates the soil,
providing a good seedbed while leaving residue
on the soil surface (Battelle, 1985).
Controlled traffic farming is a crop produc-
tion system in which the crop zone and traffic
lanes are distinctly and permanently separated,
thus reducing the soil compaction that results
from large, heavy machinery making several

passes over a field. Although primarily a re-
search concept, controlled traffic farming is
practiced in the United States to the extent that
current machinery systems allow.
Although it is also in the research stage of de-
velopment, custom-prescribed tillage is used in
some agricultural production systems. This ap-
proach to tillage integrates knowledge of soil
dynamics, machinery, climate, and crop pro-
duction economics, and entails making a pre-
scription for various components of the tillage

56 Technology, Public Policy, and the Changing Structure of American Agriculture

system. The specific machines to be used, as
well as the sequence and time of their use, is
defined in the prescription.
Multicropping is the practice of planting more
than one crop on a field during the same grow-
ing season. Such crops can be grown sequen-
tially (double cropping) or simultaneously (inter-
cropping). For example, corn and soybeans can
be grown in the same field in strips, reducing
soil erosion, using nutrients more efficiently,
and increasing crop yield. Currently available
machinery and practices are used to perform
the field operations needed in multicropping.
Organic farming reduces or eliminates chem-
ical inputs in favor of more "natural," and sup-
posedly safer, inputs. The products from this
method are sold to markets willing to pay a
premium for the assurance that chemical fer-
tilizers and pesticides have not been used in pro-
duction. Organic farmers generally prefer to use
fewer technological inputs than do conventional
farmers, including lower levels of mechaniza-
tion. They also derive their nitrogen require-
ments from planting leguminous crops in rota-
tion with nonleguminous crops and sometimes
by adding animal manure. If this system were
adopted on a large scale in the United States,
the need for more mechanization technologies
would be reduced, with the exception of the area
of waste handling systems for livestock.
No new or unique machinery is needed to fur-
ther implement conservation tillage, multicrop-
ping, or organic farming. However, consider-
able interdisciplinary research will be needed
to implement controlled traffic farming and
custom-prescribed tillage commercially. While
these concepts have many perceived economic
benefits, their true cost-benefit relationships
must be evaluated for the wide variety of crops,
terrain, soil types, and climate existing across
the United States.

Soil Erosion, Productivity,
and Tillage
The quantity and quality of harvested crops
depend on the amount of land, the suitability
of its soil for growing crops, the biology of crops,

and the environment (Foster, 1985). Most crops
are grown on clean, tilled soil, leaving the soil
exposed and unprotected. Severe erosion can
result, and over time so much soil is lost that
crop yields decrease and some land may be
forced from agricultural production. Excessive
soil erosion is estimated to occur on about 30
percent of U.S. cropland, but its effects on
productivity are thought to have been masked
by new technological inputs like hybrids, fer-
tilizers, and chemicals.
Soil erosion is the detachment of soil parti-
cles by the erosive effects of rain, surface run-
off, and wind. When erosion removes soil more
rapidly than it can be formed, soil becomes thin-
ner with less rooting depth for crops. When the
topsoil becomes thinner than the tillage depth,
subsoil becomes mixed with topsoil during till-
age, degrading the soil. Erosion also removes
the fine silt, clay, and organic particles most im-
portant for good soil quality. The resultant in-
crease in sand content of the soil reduces the
soil's productive potential. Sediment from ero-
sion can create off-site problems through de-
posits in road ditches, reservoirs, and river chan-
nels. Sediment or the chemicals it transports
can also pollute off-site air and water.
Four major lines of research on erosion con-
trol are proposed: 1) improved conservation
farming systems, 2) improved methods for as-
sessing erosion's impacts, 3) evaluation of the
potential for restoring productivity to severely
eroded soils, and 4) improved understanding
of how to use public policy to encourage soil
Of all factors affecting erosion, crop residue
left on the soil surface is most effective in re-
ducing erosion. Research on improved conser-
vation systems will thus emphasize conserva-
tion tillage, including reduced tillage, minimum
tillage, and no-tillage. These types of conserva-
tion tillage differ only in the amount of soil dis-
turbance and in the amount of crop residue left
on the soil. When matched to soil conditions,
conservation tillage can potentially provide
greater economic return and often equal or
greater yield than that of conventional tillage.
For example, no-tillage works well on well-

Ch. 2-Emerging Technologies for Agriculture 57

Photo credit: U.S. Department of Agriculture, Agricultural Research Service
Crop residue left on the soil surface is an effective way of reducing erosion. Here grain sorghum is growing in barley stubble.

drained, sloping soils but not on cool, poorly
drained soils in the Corn Belt. Although con-
servation tillage has the fewest drawbacks of
all erosion control practices, considerable de-
velopment of the method is still required.
The degree of erosion's impact is a major is-
sue that needs a conclusive answer. The prin-
cipal tool used to estimate erosion by water is
the Universal Soil Loss Equation. The tool for
estimating wind erosion is the Wind Erosion
Equation. Recent developments in erosion the-
ory and the availability of powerful, portable
computers make possible new methods that are
more detailed and more accurate for estimat-
ing erosion over a varied landscape, erosion
from individual storms, and average annual ero-

sion. Remote sensing technology and special
image processing equipment will aid in the col-
lection of data. New field studies have been ini-
tiated and several mathematical modeling tech-
niques have been developed to evaluate the
effect of erosion on crop yield.
If eroded soils can reasonably be reclaimed,
the problems of erosion maybe less serious than
presently thought. Current research in the Pied-
mont region shows that conservation tillage and
multiple cropping (explained later) can be used
to restore productivity. Much research must still
be done in this area.
Although several practices are available for
controlling erosion, many have drawbacks that

58 Technology, Public Policy, and the Changing Structure of American Agriculture

hamper adoption by farmers. As a result, vari-
ous policy alternatives are used and have been
suggested to provide incentives to farmers to
implement soil conservation. Improving the use
of public policy will entail the incorporation of
major analytical tools into an integrated pack-
age compatible with affordable computer re-
sources. Such tools will include models for cli-
mate, erosion, water quality, crop yield, pests,
and economics.
The major potential impact of this technol-
ogy on agriculture will be significantly im-
proved erosion control with little loss, if not
gain, in crop yield, improved water quality, im-
proved farmability, and increased profit. It is
hoped that this technology will provide farm-
ing systems with enough positive benefits that
erosion control becomes a side benefit.

Multiple Cropping
Multiple cropping is the intensive cultivation
of more than one crop per year on the same land
so as to use land, water, light, and nutrients ef-
ficiently (Francis, 1985). Double cropping, or
the sequential planting of two crops, such as
wheat in the winter and soybeans in the sum-
mer, is the only pattern commonly used in the
United States. Intercropping, the simultaneous
culture of two or more crops in the same field
at the same time, is popular with low-resource
Although widely used in the lesser developed
countries by farmers with limited land and re-
sources, multiple cropping systems have not
been extensively explored for their applications
in this country. Yet, in addition to their efficient
use of resources, intensive cropping systems
offer several other benefits: vegetative cover
through much of the year, which prevents ero-
sion; the need for less fertilizer, owing to the
contributions of legumes in these systems; and
moderate to high potential yields that are sus-
tainable over time.
Relatively little research attention has been
paid to these systems in temperate agricultural
regions. If such systems are to be widely adopted
in the United States, major new technological
advances may be necessary in four areas: breed-

ing crops for intensive planting systems, under-
standing competition by plant species for growth
factors, improving plant nutrition through fer-
tilizers and microbiology, and developing mech-
anization for multiple cropping.
Crop breeding for multiple cropping systems
can lead to the development of crops that can
endure the stress conditions found in multiple-
species crop combinations. Varieties and hy-
brids already exist that are well adapted to dou-
ble cropping and reasonably well suited to re-
lay cropping, the planting of two or more crops
with an overlap of the significant part of the life
cycle of each crop. Further refinement is needed
in developing new hybrids and in further se-
lecting for adaptation. Results could be avail-
able in 15 years.
The competition for growth factors by crops
that are grown together or sequentially is not
well understood. Such competition includes
that between two plants of the same species,
between two crops of different species, and be-
tween crops and weeds. Competition has been
studied in grass/legume mixtures for pasture
systems, and basic work on crop/weed compe-
tition gives insight on species interactions. Some
of the results and much of the methodology can
be applied to intercropping. Since existing va-
rieties can be used for most preliminary work,
results could be available in 6 to 10 years.
Multiple cropping entails a greater input of
nutrients or an alternative approach to plant nu-
trition. Low-resource alternative cropping sys-
tems include rotations, minimum-tillage meth-
ods, and use of low levels of fertilizers that do
not disturb the biological balance in the soil.
Research on nitrogen fixation is an active area
at present, but a basic understanding of plant
nutrition could take 10 to 15 years to develop.
Machines already available can be used for
planting and for most other cultural operations.
Through modifications of existing tillage, plant-
ing, and cultivating equipment, the farmer can
accomplish multiple cropping. However, the de-
velopment of a combine that can harvest two
crops simultaneously is necessary for intercrop-
ping to have widespread applications. This
short-term objective could be achieved within

Ch. 2-Emerging Technologies for Agriculture 59

5 years, using expertise from the commercial
The principal impacts from multiple cropping
will be reduced production costs and increased
output per year from a given unit of land. The
greater sustainability of production and the re-
duction in energy use would lead to a more sta-
ble agricultural sector.

Wed Control
The cost of weeds to agricultural production
is one of the most expensive factors in crop pro-
duction, amounting to more than $20.2 billion
annually (McWhorter and Shaw, 1985). Losses
caused by weeds include not only direct com-
petition of weeds to reduce crop yields, but also
reduced quality of produce; livestock losses;
weed control costs; and increased costs of fer-
tilizer, irrigation, harvesting, grain drying,
transportation, and storage.
Weeds can be defined as plants growing
where they are not wanted. They range from
trees and shrubs to grasses and even cultivated
crop species. Volunteer corn, for example, is
becoming an increasing problem in soybean
production as more conservation tillage prac-
tices are being adopted.
In modern agriculture, weeds are controlled
through integration of crop competition, crop
rotation, hand labor, and biological, mechani-
cal, and chemical methods into integrated weed
management systems (IWMS). Since 1950, the
use of mechanical power for weed control has
increased 30 percent, and herbicide use has in-
creased sevenfold. However, manual labor has
decreased 40 percent. As a result of modern
weed control technology, farming is now less
physical and more technological.
Although significant progress has been made
in developing new weed control technology,
weeds continue to cause severe reductions in
yield and quality. Weeds often limit expanded
use of conservation tillage and multicropping.
New difficult-to-control weed problems develop
through ecological shifts and because more
established weeds develop increased tolerance
to herbicides.

New weed control technologies needed in-
clude: 1) improved chemical and biological
methods, 2) allelopathic chemicals to bioregu-
late weeds, 3) crop cultivars with improved tol-
erance to herbicides and the discovery of the
nature of weed resistance to herbicides, and 4)
the development of improved IWMS for conser-
vation tillage and for annual multicrop pro-
Development of selective herbicides has spear-
headed the advances in weed control technol-
ogy during the last 30 years and will continue
to be important in the foreseeable future. Ma-
jor breakthroughs needed in this area include
a nonselective chemical to control vegetation
in fallow fields, more selective chemicals for
control of broadleaved weeds in dicotyledon-
ous crops (e.g., cotton, soybeans), and a chemi-
cal that can be applied postemergence for ef-
fective control of perennial weeds. There is also
interest in control of weeds by bioagents, par-
ticularly with native pathogens like fungi.

Photo credit: U.S. Department of Agriculture, Agricultural Research Service
Seed-killing methyl isothiocyanate kept crabgrass seeds
(Digitaria sanguinalis) in flask on right from germinating.
One week after the seeds were placed in flasks the
untreated crabgrass seeds in flask on left have germinated.
The chemical degrades rapidly in the soil,
usually within a few days.

60 Technology, Public Policy, and the Changing Structure of American Agriculture

The effectiveness of many herbicides is lim-
ited by soil activity; for example, some microbial
populations rapidly degrade certain herbicides,
limiting the residual effects of the herbicides.
Advances in controlled-release technology
could aid in this and other problems by reduc-
ing volatility and rates of application, reducing
herbicide movement through the soil profile,
increasing crop selectivity, and reducing envi-
ronmental exposure. Also helpful is a class of
chemical protectant that slows the action of soil
micro-organisms, permitting more cost-effec-
tive control.
Crops can be protected against the toxicity
of certain herbicides through chemical antidotes
called safeners, another class of plant protec-
tant. When applied to seeds or soil, these chem-
icals make an otherwise susceptible plant spe-
cies tolerant to an herbicide without affecting
the weed control aspect of the herbicide.
Plants themselves release secondary chemi-
cals during metabolism that can be toxic to other
plants. Such allelopathic chemicals are being
studied for their potential use in weed control.
Developments in genetic engineering may al-
low the availability of herbicide-tolerant crop
cultivars in agronomic crops in the next 10 to
15 years. Many weeds have evolved a tolerance
to herbicides. The availability of herbicide-
tolerant crop cultivars would permit the use of
herbicides at higher rates to reduce the evolu-
tion of tolerance and would permit the use of
herbicides that were previously nonselective.
Finally, research efforts need to be increased
to develop more effective IWMS. Basic ecolog-
ical research is needed to understand weed pop-
ulation dynamics, weed threshold levels, and
shifts in weed populations caused by control
technology. Research is also needed on how to
use rotational tillage to aid in controlling the
weeds that develop through several years of con-
servation tillage. Perennial weeds become par-
ticularly troublesome after only 2 or 3 years and
have forced many farmers to return to conven-
tional tillage.
Improved weed control technology will re-
sult in a slow but steady decrease in produc-

tion costs and an estimated 10 percent increase
in the cost of weed control. Increased use of con-
servation tillage will necessitate increased her-
bicide use in the next two decades.

Commercial Fertilizers
The substantial use of commercial fertilizers-
about 50 million tons per year-is generally cred-
ited with 30 to 50 percent ofof U.S. agri-
cultural production (Davis, 1985). Corn and
wheat are the most heavily fertilized crops.
Commercial fertilizers supply crops with one
or more of the primary plant nutrients (nitrogen,
phosphorus, and potassium) in forms usable by
crops. Nitrogen and phosphorus are produced
in the United States; most (about three-fourths)
potassium must be imported from Canada. Ni-
trogen, phosphate, and potassium intermediates
are produced in large plants and then shipped
to small plants for combination into final products.
Although expenditures for research and de-
velopment (R&D) in fertilizer technology are less
than 10 percent of that for the entire chemical
industry (as a percent of sales), the R&D that
exists is aimed at maximizing fertilizer effective-
ness, minimizing costs, and protecting the envi-
At present, one-half of the nitrogen applied
to the soil is lost to the plants through a variety
of inefficiencies, some of which are still not
understood. Several new types of nitrogen prod-
ucts under development might improve effi-
ciency of use. They include products with inhib-
itors to decrease undesirable transformations
in the soil (nitrification and urease inhibitors),
products coated for controlled release (e.g., the
sulfur-coated urea sold for turf and horticultural
uses), and acidified products that decrease the
volatilization of ammonia (the reaction of urea
with mineral acids in the soil). In addition, the
use of urea phosphate, urea-nitric phosphate,
and sulfur-coated urea may allow closer place-
ment of fertilizer to seed without inhibiting ger-
mination. Urea phosphate may also aid in re-
covering phosphorus, 80 percent of which is
unused by the plant and remains fixed in the
soil in insoluble forms.

Other research is under way to decrease the
energy required to produce, transport, and ap-
ply fertilizers. The escalation in oil prices fol-
lowing the oil embargo spurred efforts to de-
sign new energy-efficient plants and to retrofit
existing plants. In addition, several new urea
processes that have been announced will de-
crease production energy requirements by 25
to 50 percent. New phosphoric acid technology
also promises energy savings. To avoid depen-
dence on oil or natural gas (the raw material
for ammonia for nitrogen fertilizers), technol-
ogy for the production of ammonia from coal
is in advanced stages of development. Finally,
efforts are being made to increase the nutrient
content of fertilizers so that the energy expended
in transporting and handling will be decreased.
Another area under development is that of
phosphate fertilizer production. Because re-
serves of high-quality phosphate ore are being
depleted, researchers are attempting to use
lower quality phosphate ore in fertilizers. Their
efforts focus on removing the carbonate impur-
ities in such ore and on determining what ef-
fect such impurities would have on the efficacy
of phosphate fertilizers.
In reduced tillage agriculture, R&D efforts are
directed at developing urea-nitric phosphate,
urea with urease inhibitors, and urea phosphate
and urea sulfate, all of which have the poten-
tial to decrease ammonia loss from surface-
applied urea. Also, new types of equipment are
being designed for precision placement of fer-
tilizer and for simultaneous application of fer-
tilizer with seed.
New developments in the industry evolve
rather slowly because of the low level of R&D.
Therefore, any new technology that is likely to
be introduced by 1990-2000 would have to be
under development now. No revolutionary or
radically new products or processes appear to
be near commercialization.
The future direction of energy prices will
probably be the major factor affecting the com-
mercialization of new technology. Because the
production of nitrogen, particularly ammonia
production, is the most energy-intensive oper-
ation for the industry, new nitrogen technol-

Ch. 2-Emerging Technologies for Agriculture 61

ogy is especially geared to energy prices. The
high cost of new facilities is also a deterrent to
the adoption of technology. In many situations
the industry will prefer to debottleneck or add
to existing plants to conserve capital.

Organic Farming
Organic farming uses many conventional
farming technologies but avoids, where possi-
ble, the use of synthetically compounded fer-
tilizers, pesticides, growth regulators, and ani-
mal feed additives (Liebhardt and Harwood,
1985). It relies on crop rotations, crop residues,
animal and green manures, legumes, off-farm
organic wastes, mechanical cultivations, min-
eral-bearing rocks, and biological pest control.
Organic farmers tend to integrate their farm-
ing techniques to a greater extent than conven-
tional farmers do.
In the last 6 to 8 years, several studies have
compared organic farming with conventional
farming. Although final conclusions must await
more rigorous studies and a wider sample of
farms, preliminary conclusions show some in-
teresting benefits of organic farming: first, yields
per acre are generally equal to or only slightly
less than those from conventional farming.
Some organic farms have significantly higher-
than-average yields. Second, production costs
are lower by a high of 30 percent and an aver-
age of 12 percent, while energy inputs per unit
produced are lower by 50 to 63 percent. Few
or no insecticides, fungicides, and herbicides
are used. Third, soil erosion is significantly re-
duced through various cultivation practices. Al-
though organic farming maintains soil quality
better and reduces contamination of air, water,
soil, and the final food products, much research
is needed to determine just why organic prac-
tices have this effect and to determine how to
maximize the integration of organic practices.
One of the most significant factors in reduc-
ing production costs and energy inputs in or-
ganic farming is nitrogen self-reliance. Many
organic farmers increase nitrogen fixation in
their crops by seeding legumes between rows
of grain crops during the growing season or af-
ter harvest. Research is under way to breed

62 Technology, Public Policy, and the Changing Structure of American Agriculture

plants that fix nitrogen more efficiently or that
fix nitrogen longer in the season. By 1990, re-
search already on-line in this area should be well
For weed control, cover crops are used in ro-
tation; for example, sorghum crops are used to
suppress nutsedge. In addition, crop residues
are used in conservation tillage to suppress sen-
sitive weed species. Much information about
weed control should be available by 1990; how-
ever, the technology for wide application of crop
rotations will not be available for at least 5 to
10 years.
Organic farms appear to cycle nutrients more
efficiently than conventional systems do. One
reason is the reduction in erosion that occurs,
which allows better soil tillage and better main-
tenance of productivity. Furthermore, some or-
ganic practices enhance the soil's ability to sup-
press disease. Scientists hope to identify the
helpful bacteria and bacterial byproducts in-
volved in disease resistance and to harness them
as biocontrol agents.
Biocontrol agents are also used to control in-
sects. One example is the tansy, an insect-repel-
lent plant that shows potential for controlling
the Colorado potato beetle. Another example
is the use of an antijuvenile hormone, extracted
from a common bedding plant, that induces pre-
mature metamorphosis in insects, shortening
their immature stages and rendering the adult
females sterile. In 10 to 20 years, biological pest
repellents will probably dominate the market
because of their safety for users, consumers, and
the environment.
Converting from conventional to organic
farming takes about 3 to 5 years, during which
yield may initially be reduced. Some of this prob-
lem relates to the nitrogen content of the soil
and to weed pressure.8 However, detailed stud-
ies of holistic systems are needed to understand
better the extremely complex changes in nutri-
ent flow in soil during organic and conventional
farming. The potential impact of such studies
on U.S. agriculture in the next 10 years could
8This can be minimized by selecting the correct crops and struc-
turing the production system to avoid nutrient deficiency or weed

be considerable. If farmers shifted to organic
production, farms would be more diverse bio-
logically and economically, and the small farm
could remain economically competitive and
ensure diverse, competitive food production

Communication and Information
Technology for communication and informa-
tion management helps farm operators collect,
process, store, and retrieve information that will
enable them to manage their farm so as to mini-
mize costs, maintain and improve product qual-
ity, and maximize returns. There are three basic
components to such technology: 1) microcom-
puter-based hardware systems for information
processing, storage, and retrieval; 2) high-speed
LANs for onfarm communication of digital in-
formation; and 3) applications software. The
computer allows farm operators to keep track
of more detailed information, apply complex
problem-solving techniques to this information,
and thereby make better, more timely, decisions.
Microcomputers appropriate for onfarm use
cover the range of business-class computers.
Larger and more complex farm operations will
generally benefit from larger, more complicated
computer systems. Onfarm computers are likely
to be subject to more adverse operating envi-
ronments than those found in typical nonfarm
businesses. Thus some additional equipment
and adaptations are needed for onfarm opera-
tions (Battelle, 1985).
While LAN technology is rapidly becoming
more mature and standardized, onfarm instal-
lations are likely to be more expensive per node
than the typical business system. Farm nodes
are generally much farther apart than nodes of
the average office system. Farm installations
placed among several separate buildings are
also more susceptible to lightning-induced elec-
trical problems. Photoelectric isolators at every
node will enable use of copper wiring between
nodes. Alternately, use of LANs with fiber op-
tic cabling will eliminate problems from elec-
tromagnetic interference.

Photo credit: Dr. S.L. Spahr, University of Illinois
Example of microcomputer-based system for onfarm use.
This system collects, processes, stores, and retrieves
information to control computer feeders and
electronic milk flow meters.

Many software packages sold for use on farm
computers are general-purpose packages that
are identical to those used in other businesses.
Spreadsheet programs and database manage-
ment systems fall into this category. Other pack-
ages have only minor modifications and up-
grades. The most expensive class of software
is generally that written for specialized appli-
cations. Few farms are large enough to afford
custom programming for their own operations.
The range of specialized applications programs
that have been developed and are being devel-
oped by extension personnel at land grant col-
leges is quite large. Agricultural software from
commercial sources and the land grant institu-
tions is generally task-specific.
Another promising software concept is that
of a fully integrated system that would allow
the farm operator to simulate the outcome of
small and large changes in production practices.
The software could generate distributions of
prices and weather impacts and simulated bio-
logical growth functions. It could produce de-
tailed listings showing expected costs, returns,
production schedules, cash flows, and net in-
come streams, working within the constraints

Ch. 2-Emerging Technologies for Agriculture 63

of those assets and productive potentials that
the operator chooses to consider fixed. Such
software would give operators much greater
ability to maximize income and flexibility in
planning for growth and in responding to
changes in the economic and technical envi-

Monitoring ad Control Tech ology
Many processes in plant and animal produc-
tion may be monitored and controlled by new
and emerging electronic technologies. In some
cases these devices are designed simply to detect
certain conditions and report the information
to the farm operator. In other cases, the tech-
nology operates essentially autonomously, with-
out operator attention. Devices of this nature
are usually programmable, can operate continu-
ously, can be designed to be very sensitive to
changes in target variables, and can respond
very quickly. These devices, therefore, offer im-
provements in speed, reliability, flexibility, and
accuracy of control, and sometimes reduce

Photo credit: Dr. S.L. Spahr, University of Illinois
Electronic animal identification unit around cow's neck
with automatic dispensing grain stall in background. Cow
goes into stall, is identified electronically, and has grain
dispensed to her automatically. Using computer controls,
the feed dispensed is individualized to provide each
cow a different amount of feed and a different protein
percentage based on her nutrient needs

64 Technology, Public Policy, and the Changing Structure of American Agriculture

labor requirements (Battelle, 1985). Some ap-
plications of this technology include irrigation
control, pest monitoring and control, and the
automatic animal identification and feeding sys-
tem in livestock operations.
Positive identification of animals is necessary
in all facets of management, including record-
keeping, individualized feed control, genetic im-
provement, and disease control. All animals
could be identified soon after birth with a de-
vice that would last the life of the animal. The
device would be readable with accuracy and
speed from 5 to 10 feet for animals in confine-
ment and at much greater distances for animals
in feedlots or on pasture. Research on identifi-
cation systems for animals has been in progress
for some years, especially for dairy cows. For
example, an electronic device now used on dairy
cows is a low-power radio transponder that is
worn in the ear or on a neck chain. A feed-dis-
pensing device identifies the animal by its trans-
ponder and feeds the animal for maximum effi-
ciency, according to the lactation cycle and the
life cycle of that animal. This technology also
permits animals in different stages of produc-
tion to be penned together yet still be fed
The largest potential use of electronic devices
in livestock production will be in the area of
reproduction and genetic improvement. Estrus
in dairy cows can be detected automatically by
using sensors that remotely detect small changes
in the body temperature of the cows. Such an
estrus detection device could prove profitable
in several ways:
Animals could be rebred faster after wean-
ing and could increase the number of lit-
ters per year.
Animals that did not breed could be culled
from the herd, saving on feeding and breed-
ing space.
Time would be saved because breeding
would be done faster.
Embryo transplants would be easier be-
cause of better estrus detection.
Environmental control of livestock facilities
is another area where monitoring and control

Photo credit: U.S. Department of Agriculture, Agricultural Research Service
Fifteen center-pivot sprinklers, all operated by a master
computer, "rain" water onto 150 to 210 acres of corn per
pivot at the Condon Ranch near Sterling, Colorado.

devices can be used (figure 2-7). Microproces-
sors will be used to alleviate odorous gases and
airborne dust in ventilation systems.
One of the applications of monitoring and con-
trol technology in plant agriculture is in the man-
agement of insects and mites (Kennedy, 1985).
Improvements in the design and availability of
computer hardware and software will produce
significant changes in insect and mite manage-
ment at all levels (research, extension, pest man-
agement, personnel, and farmer). Centralized,
computer-based, data management systems for
crop, pest, and environmental monitoring in-
formation have been developed and are being

Ch. 2-Emerging Technologies for Agriculture 65

Figure 2-7.-Configuration of Monitoring and
Control Technologies in Agriculture
Example 1. Positive feedback for irrigation control
Fieid Controller
SS' decides when
S -mOlure r field needs
'eO' more water
ito | SEnriJ on.oft
(+) / ,fds onolf
SActualo lr
Additional pump
water on On-off
StI hA .l. signal

Example 2. Negative feedback for temperature control in livestock

SOURCE: Office of Technology Assessment.

evaluated for use on a regional scale by a USDA
Animal and Plant Health Inspection Service re-
gional program. Such systems will provide rapid
analysis, summarization and access to general
crop summaries, observer reports, pesticide and
field management information, reports of new
or unknown pests, general pest survey infor-
mation, and specified field locations with pest
Other software systems designed to facilitate
directly the implementation of pest manage-
ment programs are in use and are continually
being improved. The Prediction Extension Tim-
ing Estimator model (Welch, et al., 1978) is a
generalized model for the prediction of arthro-
pod phenological events but is sufficiently flex-
ible to be used for management in many agricul-
tural and nonagricultural systems. For example,
it is used as a part of the broader biological mon-
itoring scheduling system developed in Michi-
gan by Gage and others (1982) for a large num-
ber of pests on a wide variety of crops (Croft
and Knight, 1983).

An irrigation control system is another exam-
ple of using monitoring and control technology
(figure 2-2). Since irrigation decisions are com-
plex and require relatively large amounts of
information, microcomputer-based irrigation
monitoring and control systems are especially
useful in areas where soils have variable per-
colation and retention rates, where rainfall is
especially variable, or where the salinity of ir-
rigation water changes unpredictably. In this
system, a network of sensors is buried in the
irrigated fields, with radio links to the central
processor. Additional sensors may include
weather station sensors to estimate crop stress
and evaporation rates, as well as salinity sen-
sors and runoff sensors. The central processor
can then automatically allocate water to each
field according to the needs of the crops in each
field, subject to considerations of cost, leach-
ing requirements, and availability of water.


Telecommunications technology provides
links for voice communications and the trans-
mission of digital data between farms and other
firms and institutions. Through such technol-
ogy, farms, firms, and institutions can be joined
together in a large number of formal and infor-
mal networks. These networks enable farmers
to have relatively rapid, inexpensive, and relia-
ble access to central databases, centralized soft-
ware packages, and information on weather,
markets, and other subjects of interest. Virtu-
ally the same technology will be applied to both
animal and plant agriculture. Telecommunica-
tions include high speed, low speed, and radio
telecommunications, satellite base communica-
tions, and remote sensing technology (Battelle,
High-speed or high-bandwidth communica-
tions allow the farmer to send and receive much
larger amounts of data at lower costs per bit of
information. This capability is needed for video-
text services, teleconferencing, and, in many
cases, satisfactory real-time use of remote com-
puter facilities.
High-speed telecommunications is still under-
going substantial amounts of development. New

66 Technology, Public Policy, and the Changing Structure of American Agriculture

transmission capabilities or new technologies
are needed for bringing high-speed telecommu-
nications to most rural areas. High-bandwidth
telecommunications can be provided by tech-
nologies that range from conventional high-
capacity, coaxial cable, microwave relay sys-
tems to fiber optics systems and high-band-
width direct transmit/broadcast satellite sys-
tems. High-bandwidth send-and-receive serv-
ice for the average farm operation is not likely
to be available for some time.
The existing telephone system is capable of
handling the demand for slow-speed telecom-
munications services in many rural areas. The
latest generation of microcomputers, modems,
and communications software is capable of
automatically accessing remote databases and
quickly downloading and uploading information
at regular intervals without operator attention.
Rural areas that install fiber optic telecommu-
nication systems will have enormous informa-
tion capacity that will easily support very high
data rates. In fact, the perennial dream of low-
cost, two-way videoconferencing, education,
and entertainment may well become a reality
in these rural areas by 1990 or 2000.
A number of emerging radio telecommunica-
tion technologies will provide improved serv-
ice in rural areas without the need to rewire the
local telephone networks. These technologies
can be put into two groups: ground-based, low-
power radio repeater systems, such as cellular
mobile phone systems; and satellite-based com-
munication systems. In principle, the cellular
radio technology being installed in major cit-
ies can be expanded to smaller cities, towns,
and rural areas at higher power levels for use
in voice and data communications. For appli-
cations where data transmissions are sufficient
and instantaneous communications are not nec-
essary, technology for packet radio messages
may provide substantial savings. Packet radio
systems use ground-based repeater stations to
funnel messages with a standard, or "pack-
aged," format from distributed users to one
another or to a point where the messages can
be inserted into a national telecommunication
network. Messages are entered at each user sta-
tion, then converted into encoded "packets"

complete with addresses and distribution in-
structions. Each user station then transmits to
the local repeater station when the transmis-
sion channel is free. This technology may enable
cellular radio repeater technology to be ex-
tended to especially remote and sparsely popu-
lated areas and to areas where the basic tele-
phone system is inadequate and is unlikely to
be upgraded.
Satellite-based communication technologies
may provide very high-capacity telecommuni-
cation channels for rural areas. These systems
may be the only feasible high-capacity link for
some especially isolated rural areas. Large farms
may opt to establish their own ground stations
for satellite-based telecommunication, but new
generations of communication satellites may
have the power to serve many small individual
subscribers in remote rural locations.
Almost all commercial satellite communica-
tion systems employ satellites in geosynchro-
nous orbit.9 Alternately, the feasibility of using
low-cost, low-Earth orbit satellites for the col-
lection, storage, and rebroadcasting of message
packets has been demonstrated by amateur ra-
dio groups. Commercial satellites using this de-
sign could enter service by 1990.
Remote sensing is a collection of technological
systems used to detect, process, and analyze
reflected and emitted electromagnetic radiation
at a distance. This includes the National Oce-
anic and Atmospheric Administration weather
satellites, land and ocean resource mapping sat-
ellites (the Landsat series), airborne camera and
electronic sensor systems, and ground-based
photogrametric and radiometric sensors. Infor-
mation from remote sensing technology is used
for a wide range of applications. Some exam-
ples are weather reporting and forecasting, land
use planning, environmental monitoring, crop
production estimates, soil mapping, range and
forest management, mineral exploration, and
watershed management.
Remote sensing technology in the form of
weather forecasting has already made a great

OTraveling in orbit around the Equator at the same speed as
the Earth rotates.

Ch. 2-Emerging Technologies for Agriculture 67

impact on agricultural production. Weather
reports and forecasts help farmers decide when
to plant and when to harvest. Fruit growers de-
pend on local weather forecasts to help make
frost protection decisions.
Farmers can also use remotely sensed infor-
mation to make other management decisions.
Soil moisture levels can be estimated accurately
for large northern plains wheat farms that de-
pend on stored soil moisture. Selection of fields
for rotation, seeding, and fertilizer rates could
then be planned for the available moisture on
different parts of the farm to optimize net in-
Remote sensing technologies provide crucial
and timely information for the process of esti-
mating global crop production. These crop esti-
mates can have large impacts on price levels
and price variability. Estimates of crop produc-
tion in different countries are an important fac-
tor in the administration of commodity and ex-
port policies.

Labor-Saving Technology
Labor-saving technologies have made a signif-
icant dent in the cost of labor for animal pro-
duction and, to a lesser extent, for field crops.
The change to large-scale confinement opera-
tions of livestock and poultry has dramatically
reduced labor costs through the automation of
feeding, waste disposal, and egg collecting. For
field crops, reductions have come from using
larger tractors, combines, and tillage equipment.
Opportunities still exist, however, for reduc-
ing labor costs, particularly through: 1) mechani-
zation of fruit and vegetable operations, and 2)
robotic farming. Researchers and growers are
exploring ways to use these technologies with
other technologies to change cultivars and cul-
tural practices, rearrange work patterns, de-
velop labor-aid equipment (e.g., conveyors and
hoists), improve human relations, and develop
labor replacement equipment (Battelle, 1985).
Mechanical harvesting is most applicable for
fruits and vegetables that are to be processed
or dehydrated, because such products will not
show the effects of mechanical handling. Most

fruits and vegetables targeted for the fresh mar-
ket must still be harvested by hand.
The most economically important of the proc-
ess vegetables are the potato and the tomato,
both of which are mechanically harvested. The
development of mechanized tomato harvesting
is a particularly good example of technological
success: the concurrent development of a me-
chanical tomato harvester and a new, high-yield
process tomato, shaped for easy mechanical har-
vesting, gave California a production increase
of 300 percent with only a 50-percent increase
in land. Many other process vegetables are har-
vested mechanically, and research is still un-
der way to automate the harvesting of cauli-
flower, lettuce, okra, and asparagus.
Of the fruit crops, citrus crops are the largest
in total value. Although oranges would seem
to be ideally suited to mechanical harvesting
(80 percent of the crop is processed), the "bag
and ladder" method of hand picking remains
the most economical and widely used method.
For mass removal of some crops, mechanical
or oscillating-air tree shakers, usually in con-
junction with abscission chemicals, are used.
(Mechanical shakers are also used to harvest
process grapes and process deciduous fruits,
such as apples, pears, and peaches.) Technol-
ogy trends in citrus production point to higher
density plantings and the maintenance of trees
at a height of 5 meters or less. If high fruit yields
result, there is good potential for development
of over-the-row equipment for production and
The use of robotics in agriculture is likely to
be centered on high-value, labor-intensive crops
like oranges. Research is also being done on ap-
ple harvesters that will use ultrasonic sensors
to detect tree trunks and steer around the trees.
It is conceivable that by 1990, reductions in cost
and increases in the speed of operation will
make such robotic technology economically at-
tractive. Robotics may also have applications
in animal agriculture-for example, in check-
ing calving and farrowing, identifying estrus,
managing feeding, and handling manure.
Future labor replacement in agriculture will
likely involve some aspect of electronics tech-

68 Technology, Public Policy, and the Changing Structure of American Agriculture

nology, much of which will be adapted from off-
shoots of military and aerospace technology.
Such technology will have to be adapted to with-
stand the variety in agricultural environments
and will have to have better cost-benefit ratios
for widespread adoption. Many new electronics
technologies may affect the quality more than
the quantity of labor. People with higher level
skills will be needed to operate and maintain
the new, more complex equipment.

Engines and Fuels
Continued improvements in engines and fuels
can be expected in the energy efficiency, dura-
bility, and adaptability of self-propelled farm
equipment. These improvements are likely to
come from R&D in a number of areas: 1) adia-
batic and turbocompound engines, 2) electronic
engine controls, and 3) onboard monitoring and
control devices (Battelle, 1985).
Expenditures by farms on liquid fuels were
$10 billion in 1982. Even modest improvements
in energy efficiency in farm production will
have a significant impact on the total cost of
production in agriculture. However, these tech-
nologies will not be adopted unless they also
deliver significant increases in productivity to
individual farms. Farms are continuing to im-
prove their energy efficiency by converting from
gasoline-powered equipment to diesel-powered
equipment at a rapid rate. Diesel fuel has more
energy per dollar, and diesel engines extract
more useful work from each calorie of fuel than
do gasoline engines.
All conventional internal combustion en-
gines, including diesel engines, are thermally
inefficient because they must dispose of large
amounts of heat by means of cooling systems.
If engines can be constructed of special cer-
amics to withstand high operating tempera-
tures, they would not need cooling systems and
would be much more efficient. Engines of this
type are called adiabatic engines.
Turbochargers are being widely used to in-
crease the performance of gasoline and diesel
engines by putting some of the exhaust gas
energy to use. Even more work can be extracted
from the exhaust gases by means of a device

called a turbocompound unit. This device cap-
tures exhaust gas energy and applies it directly
to the drivetrain of the vehicle instead of using
the energy solely to compress intake air, as in
the conventional turbocharger. Turbocompound
units will be especially useful when installed
on adiabatic diesels, owing to the high energy
content of the exhaust gases from these engines.
Electronic engine controls are being intro-
duced by some manufacturers in an effort to
improve the efficiency of the fuel injection sys-
tem on diesel engines. As with similar systems
developed for automotive applications, this
technology automatically works to optimize fuel
delivery under changing conditions, based on
information from engine sensors, implement
sensors, and operator inputs. Minimization of
tractor wheel slip by means of onboard moni-
toring and control technology also improves fuel
efficiency. Other applications of this technol-
ogy to onboard control of field operations is de-
scribed in the section on monitoring and con-
trol technologies.
Considerable research has been conducted on
the use of alternate fuels for agricultural appli-
cations. Much of this research was motivated
by the oil embargo crisis and rapidly rising liq-
uid fuel prices of the 1970s. None of the alter-
nate fuels hold much promise to increase the
fuel efficiency of conventional engines. This re-
search has revolved around the use of onfarm
production of ethanol for use primarily in gaso-
line-powered equipment and the onfarm press-
ing and refining of sunflower oil for use in diesel-
powered equipment. Neither fuel is economi-
cally competitive with purchased liquid fuels
in the absence of substantial subsidies. More-
over, both fuels are more difficult to use than
fossil fuels. Ethanol-based fuels tend to absorb
moisture and to separate in storage. Vegetable
oil-based diesel fuels require special process-
ing, which changes their chemical and physi-
cal characteristics, before they can be used relia-
bly in unmodified diesel engines.

Crop Separation, Cleaning, and
Processing Technology
New technologies being developed to sepa-
rate, clean, and process crops offer many ben-

Ch. 2-Emerging Technologies for Agriculture 69

efits in increased yield, quality, and value of
crops. There are two major lines of research in
this area: 1) improvements in separating and
cleaning grain, and 2) in-field or onfarm proc-
essing of forages and oilseeds (Battelle, 1985).
The mechanization of grain harvesting and
separation has been one of the most important
factors in reducing the labor cost of grain pro-
duction. Even small improvements in labor or
capital efficiency have significant impacts on
grain production because of the large total cost
of producing the U.S. cash grain crop.
The basic methods of grain separation used
in all combines are mechanical beating, aera-
tion, and screening. While these methods have
been continually refined, the same basic tech-
niques have remained unchanged since antiq-
Grain harvesting productivity has been im-
proved over the past three decades by increas-
ing the size and power of combines. Combines
separate grain by beating and rubbing the grain
stalk between a stationary surface and a cylin-
der rotating at high speed. The chaff and other
debris are cleaned from the grain by blowing
a large amount of air through the grain/chaff
mix. The difference in the ability of the two ma-
terials to float on the airstream effects their sep-
Constraints on the total size and weight of
combine equipment that can be transported
over public roads limit the increases in general
harvest productivity. Within this constraint,
however, continued improvements in micro-
processor-based monitoring and control tech-
nologies incorporated into grain combines will
permit significant increases in capital and la-
bor productivity. New electronic sensors will
detect grain loss more accurately, allowing the
operator to make adjustments quickly. More-
over, if enough of the internal monitoring and
control of the grain separation process can be
automated, and if grain losses are minimized,
combine operators will be able to devote all of
their attention to guiding the combine and can

proceed at higher speeds. At present, the rate
of travel must be held to 5 to 7 acres per hour
so that the combine operator can monitor sev-
eral functions of the combine.
Improvements in cleaning grain will result
in a higher quality of grain and a reduction of
dockage at the point of distribution or sale. New
technologies will detect contaminants and re-
move them on the combine or as the grain is
transferred into farm storage. Further improve-
ments in grain cleaning will necessitate the use
of automated aeration and screening processes.
Another way to increase the value of a crop
is to do some of the processing in the field or
on the farm. A good example of in-field proc-
essing is the extraction of leaf protein juice from
alfalfa for use as high-value feed for pigs and
poultry and as a food additive for humans. The
residue of the process can be used as roughage
for livestock.
Onfarm extraction of oil from oilseed crops
such as soybeans and sunflowers has technical
merit as a way for farms to produce a diesel fuel
substitute or extender for tractors, combines,
and other equipment. Onfarm production of
vegetable oil fuel is more efficient than the con-
version of grain to ethanol fuels. Moreover, the
oilseed meal and glycerol byproducts from oil-
seed processing have substantial value as ani-
mal feed and chemical feedstocks. However, the
principal technology employed uses highly vola-
tile solvents and has a large requirement for cap-
ital, prohibiting its practical use on the farm.
Moreover, present vegetable oil prices are ap-
proximately double the price of diesel fuel.
The adoption of onfarm processing of forages
and oilseed is contingent on many domestic
and international economic, political, and in-
stitutional factors that currently override tech-
nical considerations. On the other hand, most
technologies to improve combine performance
should be achieved by the end of the decade,
at costs that will not significantly add to the to-
tal costs of today's combines.

70 Technology, Public Policy, and the Changing Structure of American Agriculture


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Ch. 2-Emerging Technologies for Agriculture 71

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Chapter 3
Impacts of Emerging Technologies
on Agricultural Production


Technology Adoption and Primary Impacts ............................ 75
The Timing of Commercial Introduction ........................... .. 76
Primary Impacts ...................................................76
Adoption Profiles ..................................................78
Projection of Per-Unit Crop Yields and Livestock Feed Efficiencies ........ 79
Projections of Aggregate Crop and Livestock Production ................. 82
Crop Production ..................................................82
Livestock and Milk Production ..................................... 83
Summary and Conclusions ................ ........................ 85
Chapter 3 References ...............................................85

Table No. Page
3-1. Estimated Percentage Change in Crop Yield ........................ 77
3-2. Estimated Percentage Change in Animal Feed and
Reproductive Efficiency .......................................... 78
3-3. Estimates of Crop Yield and Animal Production Efficiency ........... 80
3-4. Historical and Projected Rates of Annual Growth in Crop Yield....... 80
3-5. Projections of Crop Production .................................. 82
3-6. Projections of Animal Production ................................ 84

Figure No. Page
3-1. Logistic Adoption Curves for Corn, Package A ..................... 79

Chapter 3

Impacts of Emerging Technologies

on Agricultural Production

Introducing to the marketplace the 150 emerg-
ing.technologies forecasted in this study raises
questions about the effects these technologies
will have on crop yield, livestock feed efficiency,
and future food production. Many people are
concerned that the trends of major crop yields
are leveling off and that the world may not be
able to continue to produce enough food to meet
the demands of its growing population. How-
ever, OTA's analysis indicates that the United
States can continue to meet foreign and domes-
tic demand for agricultural products if agricul-
tural research is adequately supported and if
economic and political environments are favor-
able. What this conclusion means in practice
is the subject of this chapter.

OTA study participants arrived at this con-
clusion by first projecting where and under what
economic and political conditions the various
emerging technologies would be adopted and
what the primary impacts of those technologies
would be on net increases in production. Based
on this information OTA projected the impacts
of technology adoption on agricultural produc-
tion on a per-unit basis (e.g., bushels of corn per
acre) and then on an aggregate basis (e.g., mil-
lion bushels of corn produced in the entire


OTA commissioned leading scientists, spe-
cialists in the 28 technological areas, to prepare
state-of-the-art papers. Each paper: 1) defined
and delineated the scope of a technology area,
2) identified four or five major lines of research
where significant technologies were likely to
emerge by 2000, 3) discussed the current state
of technology development, 4) identified major
breakthroughs in other science and technology
areas that would be necessary for successful de-
velopment of the technology in question, 5) dis-
cussed the institutional arrangements necessary
for the research of the technology to be con-
ducted or supported, 6) estimated the time in
which a particular line of research would likely
be completed and the resulting technology in-
troduced commercially, and 7) estimated the po-
tential primary impacts of each technology on
crop and livestock production. These papers
provided the basis for discussion in two tech-
nology workshops conducted by OTA.
The workshops-one for animal technology
and the other for plant, soil, and water technol-

ogy-were conducted to assess the impacts of
emerging technologies on agricultural produc-
tion. Workshop participants, carefully selected
to include those with expertise in different
stages of technological innovation, comprised
physical and biological scientists, engineers,
economists, extension specialists, commodity
specialists, agribusiness representatives, and ex-
perienced farmers.
The participants provided data on: 1) the tim-
ing of commercial introduction of each tech-
nology area; 2) primary impacts, or net yield
increases (by commodity), expected from each
package of technologies; and 3) the number of
years needed to reach various adoption percent-
ages (by commodity).
The Delphi technique was used to obtain col-
lective judgments from the workshop partici-
pants on the development and adoption of the
emerging technologies.1 To facilitate the proc-
'The Delphi technique is a systematic procedure for eliciting
and collating informed judgments from a panel of experts. It has

76 Technology, Public Policy, and the Changing Structure of American Agriculture

ess of obtaining consensus, an electronic Con-
sensor was used to help tabulate the ratings as-
signed by each expert. A detailed discussion of
the methodology and workshop procedures is
presented in appendix A.

The Timing of Commercial Introduction
Since the impact of a new technology on agri-
culture at a given time depends in part on when
the technology is available for commercial in-
troduction, workshop participants were asked
to estimate the probable year of commercial in-
troduction of each technology under three alter-
native environments:
1. Most likely environment-assumes to year
2000: a) a real rate of growth in research and
extension expenditures of 2 percent per year,
and b) the continuation of all other forces that
have shaped past development adoption of tech-
2. More-new-technology environment (rela-
tive to the most likely environment)-assumes
to year 2000: a) a real rate of growth in research
and extension expenditures of 4 percent, and
b) all other factors more favorable than those
of the most likely environment.
3. Less-new-technology environment (relative
to the most likely environment)-assumes to
year 2000: a) no real rate of growth in research
and extension expenditures, and b) all other fac-
tors less favorable than those of the most likely
4. No-new-technology environment-assumes
to year 2000: a) none of the emerging technol-
ogies identified in the study will be available
for commercial introduction, and b) all the other
factors are the same as those under the less-
new-technology environment.

two distinct characteristics: feedback and anonymity. During the
Delphi process, responses are collated and then referred to the
experts for review. Each expert reevaluates his or her original
answers after examining the summary of the group's responses.
The iterative process of evaluation, feedback, and reevaluation
continues until a consensus is reached. Since this is not a ran-
dom sampling, the results obtained through the Delphi process
depend heavily on the experts selected.

Table A-i in appendix A shows in more detail
the sets of assumptions made under the alter-
native technology environments.
The year of commercial introduction ranged
from now-for genetically engineered pharma-
ceutical products; control of infectious disease
in animals; superovulation, embryo transfer,
and embryo manipulation of cows; and con-
trolling plant growth and development-to 2000
and beyond, for genetic engineering techniques
for farm animals and cereal crops. Of the 57
potentially available animal technologies, it was
estimated that 27 would be available for com-
mercial introduction before 1990, and the other
30 between 1990 and 2000, under the most likely
environment. In plant agriculture, 50 out of 90
technologies examined were projected to be
available for commercial introduction by 1990,
and the other 40 technologies between 1990 and
2000. The major categories of animal and plant
technologies are listed in appendix A, tables
A-2 and A-3.

Primary Impacts
When a given package of technologies is
adopted by a farmer and put into agricultural
production, its immediate impact on plant agri-
culture is increased yields and/or increased
percentage of planted acreage harvested.2 To
determine immediate impacts on animal agri-
culture, OTA considered feed efficiency for all
animals and reproductive efficiency for beef
cattle and swine, milk production per cow for

2It is often stated that U.S. agriculture needs cost-saving tech-
nology, not yield-increasing technology. Technologies can be clas-
sified into two general types according to their impact: 1) those
that reduce the cost of production directly, and 2) those that in-
crease productivity through yield increases. The first type of tech-
nology, such as nitrogen fixation and new crop varieties resis-
tant to pest, disease, and environmental stress, saves costs of
purchasing agricultural chemicals, at little additional expense.
The second type of technology, such as pesticides, herbicides,
plant-growth regulators, irrigation, and fertilizer, typically in-
crease yields, but at additional expense. Regardless of the type
of technology, all technologies reduce average costs if they are
worth adopting. For example, a new variety of corn increases
yields from 100 to 140 bushels per acre. Assuming no additional
increase in the cost of purchasing the new variety of seeds, the
total cost of production using the new variety will be shared by
140 bushels rather than 100 bushels. Thus, the new variety re-
duces the average cost 29 percent.

Ch. 3-Impacts of Emerging Technologies on Agricultural Production 77

dairy cows, and the number of eggs per layer
(producing hen) for poultry.
To estimate the net impact of emerging tech-
nologies on agricultural production, workshop
participants were first asked to project the per-
formance measures of crop and livestock pro-
duction, such as crop yields and livestock feed
efficiency, to 1990 and 2000 under the no-new-
technology environment. Historical trend lines
of the performance measures of crop and live-
stock production were provided to the partici-
pants as a basis for their projections. Through
the Delphi process, participants collectively pro-
jected the performance measures for each of
nine commodities for 1990 and 2000 (app. A,
table A-5). The nine commodities included corn,
cotton, rice, soybeans, wheat, beef cattle, dairy
cattle, poultry, and swine.
Based on those estimates and on the informa-
tion obtained from the presentations and from
discussions with the authors of the commis-
sioned papers, participants then jointly pro-
jected the net increases in crop yields, animal
feed efficiencies, and other performance meas-
ures that could be expected if specific packages
of technologies were commercially available
and fully adopted by farmers. Generally, the
28 areas of technologies were grouped in "pack-
ages" according to their probable impacts on
a commodity. Each package was further catego-
rized as a 1990 version of the package or a 2000

version of the package, thus delineating those
technologies that are expected to be introduced
by 1990 and 2000, respectively. The packages
of technologies are described further in appen-
dix A.

Through the Delphi process, OTA obtained
estimates for each package of technologies on
each of the nine commodities under the three
alternative environments. The results are shown
in tables 3-1 and 3-2. In soybean production, for
example, if technology package 1990A-which
includes genetic engineering, enhancement of
photosynthetic efficiency, plant growth regu-
lators, plant disease and nematode control, and
multiple cropping-is adopted by soybean pro-
ducers, yields are predicted to increase 2.2 per-
cent under the most likely environment, 15.2
percent under the more-new-technology envi-
ronment, and only 1.2 percent under the less-
new-technology environment. If package 2000A
is adopted, soybean yields are predicted to in-
crease 22.1 percent under the most likely envi-
ronment, 23.9 percent under the more-new-
technology environment, and 14.9 percent under
the less-new-technology environment. Package
2000A increases soybean yields substantially
more than package 1990A because it includes
such major technologies as genetically engi-
neered soybean plants, photosynthetic molecu-
lar biology and genetics, and genetically engi-
neered pest-resistant plants, all of which would

Table 3-1.-Estimated Percentage Change in Crop Yield
Technology environments
Technology Less-new-technology Most likely More-new-technology
Crop package 2000 2000 2000
Corn ............ Package A 15.6% 21.5% 28.5%
B 8.8 14.4 20.8
C -31.2 -28.8 -28.0
Cotton........... Package A 5.4 9.0 12.0
B 2.3 2.8 3.1
C 0 0 0
Rice............. Package A 8.4 12.4 15.6
B 8.8 14.4 18.6
Soybean ......... Package A 14.9 22.1 23.9
B 4.9 7.2 7.5
C 3.7 4.6 5.5
Wheat ........... Package A 24.0 24.0 24.0
B 1.5 1.5 1.5
C 5.0 5.0 5.0
SOURCE: Office of Technology Assessment.

78 Technology, Public Policy, and the Changing Structure of American Agriculture

Table 3-2.-Estimated Percentage Change in Animal Feed and Reproductive Efficiency

Animal package
Beef .............. Package

Dairy............... Package

Poultry............. Package

Swine.............. Package

SOURCE: Office of Technology Assessment.

not be ready for commercial adoption until after

Note that technology package C for corn pro-
duction, which consists of only organic farm-
ing, received very low marks from the Delphi
panel. If fully adopted, this technology will re-
sult in yield reductions ranging from 23 to 28
percent. Some organic farming specialists feel
that the panel overestimated the negative im-
pact. Harwood (1985) indicates that the best esti-
mate from the published reports is about a 10-
percent reduction. Since the cost of organic
farming is lower, the economic efficiency for
organic farming maybe higher than that for con-
ventional farming.

Adoption Profiles

The primary impacts estimated above assume
that the technologies will be fully adopted by
farmers and put into agricultural production.
But when a new technology is introduced for
commercial adoption, only a small number of
farms, mostly the large and innovative ones, will
adopt the technology initially because the pos-
sible payoff of the new technology is uncertain
and because the potential adopters need time
to learn how to use the new technology and to
evaluate its worth. As early adopters benefit
from using a new technology, more and more
farmers will be attracted to it, increasing the
speed of adoption exponentially. Eventually, as

Efficiency measure
A Pounds meat per Ib feed
Calves per cow
B Pounds meat per lb feed
Calves per cow
C Pounds meat per lb feed
Calves per cow
D Pounds meat per Ib feed
Calves per cow
E Pounds meat per Ib feed
Calves per cow
F Pounds meat per Ib feed
Calves per cow
A Pounds milk per Ib feed
Pounds milk per cow
B Pounds milk per Ib feed
Pounds milk per cow
C Pounds milk per Ib feed
Pounds milk per cow
D Pounds milk per Ib feed
Pounds milk per cow
A Pounds meat per Ib feed
Eggs per layer per year
B Pounds meat per Ib feed
Eggs per layer per year
C Pounds meat per Ib feed
Eggs per layer per year
A Pounds meat per Ib feed
Pigs per sow per year
B Pounds meat per lb feed
Pigs per sow per year
C Pounds meat per Ib feed
Pigs per sow per year

Technology environments
Less-new-technology Most likely More-new-technology
2000 2000 2000
0 22.4% 30.4%
0 0 28.4
5.8% 10.4 12.4
1.2 5.2 6.4
1.8 4.5 5.8
1.2 2.0 3.2
0.1 1.2 1.7
0 0.3 0.9
1.4 2.8 3.3
2.3 5.3 6.6
0 1.1 1.5
0 0 0
5.8 13.2 15.2
6.8 12.2 15.2
7.6 11.0 13.0
9.4 12.2 14.6
7.8 12.4 15.2
15.0 21.3 24.3
25.6 25.6
25.6 25.6
7.3 9.2 11.3
4.6 5.8 7.1
2.5 3.1 3.9
4.0 5.0 6.2
1.3 1.6 2.0
1.6 2.0 2.5
4.8 12.6 15.0
14.4 27.6 50.0
2.8 4.0
14.4 20.8
2.1 2.1
0.8 2.4

Ch. 3-Impacts of Emerging Technologies on Agricultural Production 79

most potential adopters adopt a new technol-
ogy, the percentage of adoption will level off
and approach a maximum; thus, the adoption
profile follows an S-shaped curve (Lu, 1983).
To derive an adoption profile of each pack-
age of technologies for each commodity under
different economic environments, participants
were divided into commodity groups accord-
ing to their expertise in a particular commodity.
There were four groups in the animal technol-
ogy workshop (beef, swine, dairy, and poultry)
and five in the plant, soil, and water technol-
ogy workshop (wheat, corn, cotton, soybean,
and rice). The participants were then asked the
question, "If a specific package of technologies
is introduced in the market today, how long will
it take for farmers to have it adopted?" Based
on their collective experience, the participants
estimated the following for each package of tech-
1. The maximum percentage of adoption.
2. The number of years it would take to reach
20-percent adoption.
3. The number of years it would take to reach
50-percent adoption.
Based on information from the commodity
groups, a logistic curve was fitted for each pack-
age of technologies applied to each of the nine
commodities under different scenarios. Figure
3-1 shows the estimated adoption curves for
package A corn technologies, which consist of
plant genetic engineering, plant disease and
nematode control, management of insects and
mites, water and soil-water-plant relations,

Figure 3-1.-Logistic Adoption Curves for Corn,
Package A
80 -
70 -
60 /
30 -
10 -
0 2 4 6 8 10 12 14 16 18 20 22 24
Years from introduction date

- More-new-technology

*- Less-new-technology

-- Most likely environment
Source: Office of Technology Assessment.

communication and information management,
monitoring and control, and telecommunica-
tions. The participants estimated that it would
take 8 years to reach 20-percent adoption un-
der the most likely environment, while it would
take only 6 years to reach it under the more-
new-technology environment, where the eco-
nomic environment is more favorable for tech-
nology adoption. To reach 50-percent adoption,
it would take 11 years under the most likely envi-
ronment and 10 years under the more-new-tech-
nology environment. The maximum adoption
rate projected is 80 percent under both envi-


Based on the information obtained from the
workshops on: 1) the years of commercial intro-
duction, 2) the primary impacts, and 3) the adop-
tion profiles, OTA computed the efficiency
measurements for all animals and the average
yield and percentage of planted acreage for all
crops in 1990 and 2000 under alternative envi-

ronments. The results are presented in tables
3-3 and 3-4.3
Under the most likely environment, feed effi-
ciency in animal agriculture will increase at a
'For ease of presentation, the less-new-technology environment
is not presented. Its estimates fall between the no-new-technology
and most likely environments.

80 Technology, Public Policy, and the Changing Structure of American Agriculture

Table 3-3.-Estimates of Crop Yield and Animal Production Efficiency


Most likely


Corn-bu per acre .................. 113 124 139 150
Cotton-lb per acre ................. 481a 511 554 571
Rice-bu per acre ................... 105 109 124 134
Soybeans-bu per acre .............. 30a 35 37 37
Wheat-bu per acre ................. 36 41 45 46
Pounds meat per Ib feed............. 0.070 0.066 0.072 0.073
Calves per cow ..................... 0.88 0.96 1.0 1.04
Pounds milk per Ib feed ............. 0.99 0.95 1.03 1.11
Milk per cow per year (1,000 Ib) ...... 12.3 15.7 24.7 26.1
Pounds meat per Ib feed............. 0.40 0.53 0.57 0.58
Eggs per layer per year .............. 243 260 275 281
Pounds meat per Ib feed............. 0.157 0.17 0.176 0.18
Pigs per sow per year ............... 14.4 15.7 17.4 17.8
aNot actual-based on estimate from trend line.
bThese estimates differ from those in table 2-2 of the first report from this study because of changes made at a later date by workshop participants in the adoption
rate of some of the dairy technology packages.
SOURCE: Office of Technology Assessment.

Table 3-4.-Historical and Projected Rates of Annual Growth in Crop Yield

No-new-technology Most likely More-new-technology
1960-82 environment environment environment
Corn........... 2.6% 0.5% 1.2% 1.6%
Cotton ......... 0.1 0.3 0.7 1.0
Rice ........... 1.2 0.2 0.9 1.4
Soybean........ 1.2 0.8 1.2 1.2
Wheat ......... 1.6 0.7 1.2 1.4
SOURCE: Office of Technology Assessment.

rate of from 0.2 percent per year for beef to 1.4
percent for poultry. In addition, reproduction
efficiency will also increase, at an annual rate
ranging from 0.6 percent, for beef cattle, to 1.1
percent, for swine. Milk production per cow
per year will increase at 3.9 percent per year,
from 12,300 pounds to 24,730 pounds per cow,
in the period 1982-2000.
Major crop yields are estimated to increase
from 1982 until 2000 at a rate ranging from 0.7
percent per year, for cotton, to 1.2 percent per
year, for wheat and soybeans. Wheat yield, for
example, is projected to increase at the rate of
0.7 percent per year, from 36 bushels per acre

in 1982 to 41 bushels per acre in 2000, assum-
ing no new technologies will become available
before 2000. Under the most likely environment,
wheat yields will increase at the rate of 1.2 per-
cent per year to 45 bushels per acre. The differ-
ence in wheat yield between the two environ-
ments, 4 bushels per acre, represents the impact
of new technologies under the most likely envi-
How do these rates of increase compare with
historical trends? Will emerging technologies
significantly change the trends? By far the most
drastic increases in productivity will be in milk
production, primarily because the products of

Actual 1982

Ch. 3-Impacts of Emerging Technologies on Agricultural Production 81

genetic engineering will soon be available for
commercial adoption by the dairy industry. One
of the proteinaceous pharmaceuticals, bovine
growth hormone, is alone expected to increase
milk yields between 20 to 40 percent almost
overnight via daily injections of the hormone
into cattle.
From 1960 to 1982 milk production increased
2.6 percent per year, from 7,029 pounds per cow
per year to 12,316 pounds. If no new technol-
ogy is available from now until 2000, this rate
of increase would not be maintained. Under
such an environment milk production per cow
per year is expected to increase at only 1.4 per-
cent per year, from 12,316 pounds in 1982 to
15,700 pounds in 2000. However, if new tech-
nologies are adopted, the rate of increase in milk
production would far surpass the historical rate,
under the remaining technology environments.
Under the more-new-technology environment,
milk production is expected to reach 26,080
pounds in 2000, at an annual rate of 4.2 percent.
Application and adoption of new technologies
will also increase the feed efficiency of other
animals. Poultry feed efficiency has been in-
creasing at 1.2 percent per year for the last 15
years. Under the most likely environment, feed
efficiency will increase at 1.4 percent per year
through 2000.
The feed efficiencies for beef and swine have
not increased for the last 15 years. Beef feed effi-
ciency declined from 0.093 pounds of beef per
pound of feed in 1965 to 0.065 pounds in 1973
and then maintained at about 0.070 pounds in
recent years. The introduction of new technol-
ogies will increase feed efficiencies. Under the
most likely environment, the feed efficiency is
projected to increase at an annual rate of 0.2
percent, reaching 0.072 pounds of beef per
pound of feed in 2000. Swine feed efficiency
has declined steadily from 0.19 pounds of pork
per pound of feed in 1974 to 0.15 pounds in 1980.
Under the most likely environment, feed effi-
ciency will increase to 0.18 pounds of pork per
pound of feed in 2000, at the rate of 0.4 percent
per year.
Efficiencies in crop production will be less
dramatic than those in animal production, pri-

marily because development of biotechnology
for plants is far behind that for animals. Most
of the major plant biotechnologies will not be
commercially available before 2000. Therefore,
it will be difficult to maintain historical trends
without infusion of new technologies. As shown
in table 3-4, all major crops included in this
study, except for cotton, have experienced phe-
nomenal growth during the past 20 years. The
average annual rates of growth range from 1.2
percent, for rice and soybeans (and 1.6 percent
for wheat), to 2.6 percent for corn. Without new
technologies, these trends cannot continue. Un-
der the no-new-technology environment, the
yields of major crops are expected to grow only
at 0.2 percent per year for rice, to 0.8 percent,
for soybeans. Even under the most likely envi-
ronment, corn and wheat yields still could not
keep up with past growth. Under the more-new-
technology environment, the annual rates of
growth of all major crops, except for corn and
wheat, are expected to equal or exceed histori-
cal rates of growth. The growth rate of corn
yields under the most favorable environment
is expected to be 1.6 percent, which is far short
of the historical rate of 2.6 percent per year.
New technologies could have a significant im-
pact on cotton and rice yields. Cotton yields have
not increased much during the last two decades.
Instead, they have been fluctuating around the
trend line, which has increased at the rate of
only 0.1 percent per year from 1960 to 1982.
Adoption of new technologies could shift the
trend upward. Under the most likely environ-
ment, cotton yields are projected to increase at
0.7 percent per year, and under the more-new-
technology environment, 1.0 percent per year.
Although rice yields have increased at an aver-
age of 1.2 percent per year since 1960, the yield
curve has been flattened since 1967. During the
1960-67 period, rice yields increased at 4.1 per-
cent per year, but the rate of growth has declined
to only 0.2 percent per year since 1967. Intro-
duction of new technologies into rice produc-
tion could turn the yield curve upward. Under
the most likely environment, rice yields are ex-
pected to increase 0.9 percent per year, and un-
der the more-new-technology environment, 1.4
percent. This is the highest rate of growth esti-
mated among all major crops.

82 Technology, Public Policy, and the Changing Structure of American Agriculture


OTA used the projected crop yields and per-
cent of planted acres harvested for major crops,
and the projected feed and reproductive effi-
ciencies of livestock, to assess the collected im-
pacts of the 28 areas of emerging technologies
on the total production of various crop and live-
stock products. The primary tool used in the
analysis was an econometric model which is
an annual, partial equilibrium model consist-
ing of a crop sector, a livestock sector, and a
financial sector.4 The model is a partial equi-
librium model in that a general equilibrium so-
lution is solved within the agricultural sector
while a specified set of conditions are assumed
to exist within the rest of the economy, such
as population growth, income growth, export
demand, and interest rates. The model was used
in a 20-year simulation projecting the effects
of technological change on the various crop and
livestock commodities previously discussed.
The results appear below.

4The model used was the Iowa State University econometric
model developed by Earl Heady.

Crop Production

Applications of new technologies will in-
crease aggregate crop production throughout
the projection period-from 1981 to 2000. Table
3-5 shows projections to year 2000 of increased
production for five major crops. Total U.S. crop
production was determined by average crop
yields and acres of crops harvested. Crop yields
were projected to 2000 under the three technol-
ogy environments from the results of the tech-
nology workshop. The projections took into ac-
count the timing, adoption profiles, and primary
impacts of emerging technologies. Acres of
crops harvested were determined by the model,
based on expected returns from crop produc-
tion, diversion payments, and other crop-
specific considerations.
Although there will be a drop in the number
of acres of corn planted, projected yield in-
creases and increases in the proportion of
planted acres actually harvested will cause corn
production to increase over time under each
environment. The increase will be greatest un-
der the more-new-technology environment, a

Table 3-5.--Projections of Crop Production
No-new-technology Most likely More-new-technology
Crop Unit 1984 environment environment environment
Production ..... Billion bu 7.7 8.6 9.3 9.7
Growth rate..... Percent 0.7 1.2 1.5
Production ..... Billion Ib 6.2 6.4 6.9 7.2
Growth rate..... Percent 0.1 0.7 0.9
Production ..... Million cwt 137.0 153.6 163.4 169.2
Growth rate..... Percent 0.7 1.1 1.3
Production ..... Billion bu 1.9 3.0 3.2 3.3
Growth rate..... Percent 3.1 3.4 3.6
Production ..... Billion bu 2.6 3.3 3.5 3.5
Growth rate..... Percent 1.5 1.9 2.0
aProjections shown for this commodity differ from those in table 2-3 of the first report from this study because the previous
figures were preliminary.
SOURCE: Office of Technology Assessment.

Ch. 3-Impacts of Emerging Technologies on Agricultural Production 83

situation that is also true for the other crops
Unlike planted acres of corn, planted acres
of soybeans will increase during the projection
period. Increases in yields and increases in har-
vested acres will cause total U.S. soybean pro-
duction to increase significantly over the 1982
through 2000 projection period. Because yields,
planted acres, and proportion of planted acres
harvested vary little across different environ-
ments, production increases do not vary much
across environments. The rate of increase ranges
from 3.1 to 3.6 percent per year for the no-new-
technology and more-new-technology environ-
ments, respectively.
Planted acres of wheat are projected to in-
crease under the no-new-technology environ-
ment but to decrease under the most likely and
more-new-technology environments. Increases
in average wheat yields will cause wheat pro-
duction to increase over the projection period.
As shown in table 3-4, cotton yields are pro-
jected to increase relatively less than corn, soy-
bean, and wheat yields. Planted acres of cotton
are projected to increase under each of the tech-
nology environments, with only slight differ-
ences across environments. Increases in both
yields and harvested acres will cause total U.S.
cotton production to increase.
Planted acres of rice are also projected to in-
crease under each technology environment. As
shown in table 3-4, rice yields are projected to
increase over time for each environment. In-
creasing yields and increasing harvested acres
will cause total rice production to increase over

Livestock and Milk Production
Technology impacts are felt in the livestock
sector through calving rate changes for beef and
through feed input price differentials for beef
and other livestock. Higher feed efficiencies and
crop production levels under the more-new-
technology compared with the no-new-technol-
ogy environments result in lower corn, soybean
meal, and wheat prices. The lower prices of
these feed inputs cause livestock production to

increase generally. The higher calving rates
under the more-new-technology environment
also tend to increase beef production. Increased
production tends to depress livestock and meat
prices if demand for livestock and meat does
not increase proportionately.
The production of prime beef is determined
by the number of feeder cattle slaughtered, the
average fed cattle weight at slaughter, and the
conversion ratio of live weight to carcass weight
(dressing percentages).
As shown in table 3-6, prime beef production
decreases over time for all technology environ-
ments. Due to higher calving rates and lower
feed costs, beef production is highest under the
more-new-technology environment. Under the
most likely environment, beef production is pro-
jected to decline from 1984 to 2000 based on
a weakness in consumer demand caused by
changes in income levels, shifts in taste, and
concern over potential health problems associ-
ated with the consumption of red meat, among
other factors.
The impacts of technology on pork produc-
tion are reflected only through differences in
feed input prices. Differences in farrowing rates
are not accounted for across environments. As
shown in table 3-6, pork production is projected
downward for all technology environments.
The downward trend is attributed to higher feed
input prices and higher retail pork prices re-
sulting from lower production. Pork production
under the most likely environment is projected
to drop 15 percent from 1984 to 2000.
Chicken production is projected to increase
over time for all technology environments, and
the differences across the various environments
are minimal.
Total milk production is determined by mul-
tiplying milk yield times milk cow numbers.
Milk yield, as indicated earlier, is projected to
increase through 2000, owing in large part to

the anticipated emergence and adoption of bio-
technologies in the dairy industry. Cow num-
bers are determined in the model as a positive
function of the ratio of the blend price of Grade
A and Grade B milk over the average ration cost

84 Technology, Public Policy, and the Changing Structure of American Agriculture

Table 3-6.-Projections of Animal Production
No-new-technology Most likely More-new-technology
Livestock Unit 1984 environment environment environment
Prime beef:
Production ..... Billion Ib 16.0 12.5 14.1 15.7
Growth rate..... Percent -1.5 -0.8 -0.2
Production ..... Billion Ib 13.5 16.8 16.7 16.7
Growth rate..... Percent 1.4 1.3 1.3
Production ..... Billion Ib 13.8 10.7 11.7 13.0
Growth rate..... Percent -1.6 -1.0 -0.4
Production ..... Billion Ib 135.4 126.1 192.1 201.8
Growth rate..... Percent -0.4 2.2 2.5
SOURCE: Office of Technology Assessment.

and a negative function of the cull price of dairy
cows. The blend price falls slightly for each envi-
ronment over the projection period. The aver-
age ration cost and cull cow price are exoge-
nously projected to increase over the 1983-2000
period. As a result, cow numbers are projected
to decline by at least 30 percent over the period,
with only small differences across the envi-

Given the increases in milk productivity and
the decreases in cow numbers, what will hap-
pen to total milk production over time? As
shown in table 3-6, under the no-new-technology
environment, milk production will fall at 0.4 per-
cent per year from 1982 through 2000 because
reductions in cow numbers more than offset in-
creases in milk yield. Under the other two envi-
ronments, milk production will increase despite
the reductions in numbers of cows. The largest
increases are projected to occur before 1990.

In the world agricultural marketplace, avail-
able information points to a periodic series of
surpluses and deficits over the next two dec-
ades (Mellor, 1983; Resources for the Future,
1983). A Resources for the Future (RFF) study
indicates that the global balance between cereal
production and population will remain quite
close until year 2000, indicating vulnerability
to annual shortfalls resulting from weather,
wars, or mistakes in policy. Over the next 20
years the world will become even more depen-
dent on trade. There will be increasing compe-

tition for U.S. farmers in international markets.
Much of this increased competition will come
from developing countries selling farm com-
modities as a source of exchange to pay for im-
ports such as oil. Despite this increased com-
petition, exports of grain from North America
are projected nearly to double by year 2000.
On the other hand, there is another school of
thought that believes current studies such as that
by RFF have not properly assessed the magni-
tude and impact of emerging technologies on
farm production. Technologies such as genetic
engineering and electronic information tech-
nology that are available now in various forms
could mean rapid increases in yields and pro-
ductivity. While such changes may improve the
competitive position of American agriculture,
they might create surpluses and major struc-
tural change-favoring, for example, larger,
more industrialized farms.
Any conclusion regarding the balance of glob-
al supply and demand requires many assump-
tions about the quantity and quality of resources
available to agriculture in the future. Land,
water, and technology will be the limiting fac-
tors to agriculture's future productivity.
Agricultural land that does not require irri-
gation is becoming an increasingly limited re-
source. In the next 20 years, out of a predicted
1.8-percent annual increase in production to
meet world demand, only 0.3 percent will come
from an increase in quantity of land used in pro-

Ch. 3-Impacts of Emerging Technologies on Agricultural Production 85

duction (RFF, 1983). The other 1.5 percent will
have to come from increases in yields-mainly
from new technology. Thus, to a very large ex-
tent, research that produces new technologies
will determine the future world supply/demand
balance and the amount of pressure placed on
the world's limited resources.
The OTA results indicate that with continu-
ous inflow of new technologies into the agri-
cultural production system, U.S. agriculture will

be able not only to meet domestic demand but
also to contribute significantly to meeting world
demand in the next 20 years. This does not nec-
essarily mean that the United States will be com-
petitive or have the economic incentive to pro-
duce. It means only that the United States will
have the technology and resources available to
provide the production increases needed to ex-
port for the rest of this century.


OTA finds that emerging agricultural tech-
nologies, if fully adopted, will produce signifi-
cant impacts on the performance of plant and
animal agriculture. The most dramatic impacts
will first be felt in the dairy industry, where new
genetically engineered pharmaceuticals (such as
bovine growth hormones and feed additives)
and information management systems will soon
be introduced commercially. New technologies
adopted by the dairy industry will increase milk
production far beyond the 2.6-percent annual
rate of growth of the past 20 years. Under the
most likely environment, milk production per
cow is expected to increase at an annual rate
of 3.9 percent. Applications of new technologies
will also increase the feed efficiency and repro-
ductive efficiency of other agricultural animals.
Because development of biotechnology for
plant agriculture is lagging behind that for ani-

mal agriculture, significant impacts from such
technology will not be felt in plant agriculture
before the turn of the century. The development
and adoption of the new technologies under the
most favorable environment will, in the short
run, increase the rates of growth of major crop
yields, except for corn, at about the level of the
historical rates of growth. However, the impacts
of these technologies will be substantially
greater for plant agriculture after 2000.
The OTA study indicates that, with a contin-
ued flow of new technologies into the agricul-
tural production system, major crop yields will
continue to grow and U.S. agriculture will con-
tinue to provide enough food to meet domestic
and foreign demand as long as agricultural re-
search is adequately supported and economic
and political environments are favorable.


Harwood, Richard, Program Officer, International
Agricultural Development Service, personal com-
munication, July 30, 1985.
Lu, Yao-chi, "Forecasting Emerging Technologies
in Agricultural Production," in Yao-chi Lu (ed.),
Emerging Technologies in Agricultural Produc-
tion, Cooperative State Research Service, U.S. De-
partment of Agriculture, 1983.

Mellor, John W., "Food Prospects for the Develop-
ing Countries," American Economic Review,
May 1983, pp. 239-243.
Resources for the Future, "Meeting Future Needs
for United States Food, Fiber and Forest Prod-
ucts," report prepared for the Joint Council on
Food and Agricultural Sciences (Washington, DC:
December 1983).

Part II
The Changing Structure
of American Agriculture

Chapter 4
Dynamic Structure
of Agriculture


Present Structure of Agriculture..................................... 91
Changes in the Structure of U.S. Agriculture .................. ....... 92
Changes in Farm Size and Number ................................ 92
Changes in the Distribution of Sales and Income .................... 93
Changes in the Sources of Income ................................. 94
Projections of Structural Change in U.S. Agriculture to Year 2000 ....... 96
Structure of U.S. Agriculture by Major Commodity Groups ............. 97
Cash Grain Subsector ............................................ 98
Cotton Subsector ...................... ....................... 98
D airy Subsector ................................................. 99
Poultry Subsector .................................... ............ 99
Cattle and Calf Subsector ......................................... 99
Pork Subsector .................................................. 100
Regional Structure.................................... ............ 100
Comparison Between Regions and Commodities ..................... 102
Distribution of Sales Within Regions and Among Regions ............. 103
Sum m ary ........................................................ 105

Table No. Page
4-1. Sales Classes of Farm s ........................................ 92
4-2. Number of Farms and Percent of Farms by Sales Class, 1969-82 .... 93
4-3. Gross Farm Income and Percent of Gross Farm Income
by Sales Class, 1969-82 ........................................ 93
4-4. Net Farm Income and Percent of Net Farm Income
by Sales Class, 1969-82 ........................................ 94
4-5. Total Farm Income and Percent of Total Farm Income
by Sales Class, 1969-82 ........................................ 94
4-6. Average Gross Farm Income, Net Farm Income, Off-Farm Income,
and Total Income of Farms, 1969-82 ............................ 95
4-7. Most Likely Projection of Total Number of U.S. Farms
in 1990 and 2000, by Sales Class ................................ 96
4-8. Percent of Total U.S. Sales of All Commodities
by Commodity Group and Region, 1982 .......................... 102
4-9. Percent of Total U.S. Sales of Each Commodity by Region, 1982 .... 102
4-10. Percent of Total Regional Sales by Commodity, 1982 .............. 103

Figure No. Page
4-1. Cash Grain Sales by Sales Class, 1969-82 ........................... 98
4-2. Cotton Sales by Sales Class, 1969-82 ............................... 98
4-3. Dairy Sales by Sales Class, 1969-82 ................................ 99
4-4. Poultry Sales by Sales Class, 1969-82 .............................. 99
4-5. Cattle Sales by Sales Class, 1969-82 ............................... 100
4-6. Hog and Pig Sales by Sales Class, 1969-82 ......................... 100
4-7. Regions and Divisions of the United States ......................... 101

Chapter 4

Dynamic Structure of Agriculture

Who will use a technology is as important a
consideration as which technology will be
adopted, for the distribution of technology af-
fects both agricultural production and the socio-
economic structure of the entire agricultural
The trend toward concentration of agricul-
tural resources in fewer but larger farms will
continue, although the degree of concentration
will vary by region and by commodity. Indeed,
in the future, 75 percent of the food and fiber
in this country will probably be produced by
only 50,000 of the 1 million farms in existence.

Further concentration of resources will be most
likely in those industries already highly concen-
trated, for example, the broiler, fruit and vegeta-
ble, and dairy industries.
Several factors contribute to the changing
character of the agricultural sector: policies,
institutions, economies of size, and new tech-
nologies themselves. This chapter provides a
perspective for analyzing technology's distribu-
tional impacts on agricultural structure by sur-
veying the characteristics of that structure and
the factors that affect it.


The heart of agriculture-the farm-is offi-
cially defined as a place that produces and sells,
or normally would have sold, at least $1,000
worth of agricultural products per year. So de-
fined, there were about 2.2 million farms in
1982. Farms in that year had an average net in-
come from farming of $9,976 and an average
off-farm income of $17,601, for total of $27,577.
Perhaps the best known characteristic of U.S.
agriculture is the trend toward larger but fewer
farms. Currently, about 1 billion acres of land
are in farms, resulting in an average farm size
of about 400 acres. However, this average size
has little meaning, since fewer than 25 percent
of all farms fall within the range of 180 to 500
acres. Almost 30 percent of all U.S. farms have
less than 50 acres, whereas 7 percent have more
than 1,000 acres.
The number of farms reached a peak of about
6.8 million farms in 1935 and is now approxi-
mately 2.2 million. The rate of decline has
slowed since the late 1960s, with a loss of about
100,000 farms since 1974.
Employment in farming began a pronounced
decline after World War II, when a major tech-
nological revolution occurred in agriculture.
The replacement of draft animals by the trac-

tor began in the 1930s and was virtually com-
plete by 1960, releasing about 20 percent of the
cropland, which had been used to grow feed
for draft animals.
The increased mechanization of farming per-
mitted the amount of land cultivated per farm
worker to increase fivefold from 1930 to 1980.
The amount of capital used per worker in-
creased more than 15 times in this period. To-
tal productivity (production per unit of total in-
puts) more than doubled because of the adoption
of new technologies such as hybrid seeds and
improved livestock feeding and disease preven-
tion. The use of both agricultural chemicals and
fuel also grew very rapidly in the postwar pe-
riod. Agricultural production began to rely heav-
ily on the nonfarm sector for machinery, fuel,
fertilizer, and other chemicals. These, not more
land or labor, produced the growth in farm pro-
duction. The resultant changes have greatly in-
creased the capital investment necessary to
enter farming and have generated new require-
ments for operating credit during the growing
One of the best ways to look at changes in the
economic structure of U.S. agriculture is in
terms of value of production as measured by

92 Technology, Public Policy, and the Changing Structure of American Agriculture

gross sales per year. Farms can be usefully clas-
sified into the five categories of gross sales
shown in table 4-1.
Small farms generally do not provide a sig-
nificant source of income to their operators.
This class of farms is operated by people living
in poverty and by people who use the farm as
a source of recreation.
Part-time farms may produce significant net
income but in general are operated by people
who depend on off-farm employment for their
primary source of income.

Table 4-1.-Sales Classes of Farms

Part-tim e ... ....................
M moderate ......................
Very large ......................
SOURCE: Office of Technology Assessment.

Amount of gross
sales per year
< $20,000
$20,000 to $99,999
$100,000 to $199,000
$200,000 to $499,999
a: $500,000

Moderate-size commercial farms cover the
lower end of the range in which the farm is large
enough to be the primary source of income for
an individual or family. Most families with
farms in this range also rely on off-farm income.
In general, farms in this range require labor and
management from at least one operator on more
than a part-time basis.
Large and very large commercial farms in-
clude a range of diverse farms. The great ma-
jority of these are family owned and operated.
Most farms in these classes require one or more
full-time operators, and many depend on hired
labor on a full-time basis. Five percent of these
farms are owned by nonfamily-owned corpora-
tions, a much higher percentage than in the
other three classes. In general, the degree of con-
tracting and vertical integration is much higher
in these classes.


In tables 4-2 to 4-5 changes in the structure
of U.S. agriculture between 1969 and 1982 are
presented in terms of four basic attributes: num-
bers of farms, gross income of farms, net farm
income, and off-farm income. The information
in each table has been adjusted to account for
the impact of inflation and is presented in terms
of constant 1982 dollars. Inflation in commodity
prices over the 13 years between 1969 and 1982
has tended to move many farms from lower sales
classes into higher sales classes. Farm numbers,
sales, and income values have accordingly been
redistributed to correct for this.1

Changes in Farm Size and Number
Major changes in the structure of U.S. agri-
culture can be seen in the changes in the num-
ber of farms shown in table 4-2. Even after the

'The redistribution to correct for inflation interms of 1982 dol-
lars has the effect of moving farm numbers, sales, and income
from lower sales classes into higher sales classes in the years prior
to 1982.

number of farms was redistributed toward the
larger sales classes in the years prior to 1982,
the real number of small farms declined by about
39 percent-a dramatic decline. Recent reports
that the number of small farms has actually in-
creased since 1978 refer primarily to farms that
have less than 50 acres, not to farms with less
than $20,000 per year in sales. The number of
part-time farms has increased by about 57 per-
cent. The number of moderate-size farms has
increased greatly, by 111 percent. The numbers
of large and very large farms have also increased
very dramatically, by about 130 and 101 per-
cent, respectively. The substantial increase in
the real number of moderate-size farms appears
to contradict many claims that the moderate-
size farm is disappearing from the structure of
American agriculture. However, as will be shown
in the next two sections and in later chapters,
changes in the number of farms is not, by itself,
a good indicator of economic health or the abil-
ity of different classes of farms to survive finan-