Economic Implications

An overview of the Agricultural Industry in the US today

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The agricultural industry in the US today is very different than what it was twenty years ago. The industry has become concentrated, and competition has been reduced in almost all aspects of the industry. U.S. farms numbered 2,063,300 in 1993, down dramatically from the peak of 6.8 million in 1935. Although 73 percent of U.S. farms were noncommercial (sales less than $50,000) in 1993, they accounted for only 10 percent of production. At the other extreme, farms with sales of $1 million or more made up only 0.7 percent of all farms but accounted for 26 percent of gross sales. Agricultural markets used to be characterized by large numbers of buyers and sellers trading homogeneous commodities on the open market, where spot prices coordinated product flow from sellers to buyers. This is changing as significant market concentration (a smaller number of firms accounting for a greater portion of sales or purchases) has occurred in all aspects of the agricultural sector. While how agricultural products are being sold is changing, so is what is being sold. Consumers are becoming increasingly time conscious, health conscious, and ethnically diverse, which is affecting foods demanded, and, in turn, how food is produced and marketed.

This also directly correlates with the rise in genetically modified foods. As the number of seed companies has dropped dramatically, decisions regarding genetically modified seeds and crops are now in the hands of a few key companies. Although the complexity and expense in developing biotechnology is great, and therefore requires the backing of a large company, these companies have one goal: to make money. This goal is not necessarily compatible with the idea that the most important issue should be the long term safety and viability of the food supply in America and the world.

An overview of the fertilizer industry.


The US Dept. of Agriculture (

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