At a time when farmers around the world are struggling to recoup their production costs, an Oxfam report says 62 new food billionaires have joined the super-rich club in the past two years. The report, of course, speaks of 12 Cargill family billionaires, up from eight before the pandemic, jumping on the opulent bandwagon.
Riding high commodity prices, soaring food inflation, record land values and a succession of technological innovations, all in the name of increasing productivity, agribusiness profits s ‘fly away. As Oxfam (Great Britain) Chief Executive Danny Sriskandarajah says: “At a time when hundreds of millions more people face extreme poverty, governments can have no excuse not to ‘attack gargantuan profits and wealth to ensure no one is left behind’, which remains unexplained, which is why the skyrocketing profits that food supply chains have found themselves with have not trickled down to the primary producer, the farmer.
After all, four grain trading companies, including global giant Cargill, control 70% of international food trade. We know that the agricultural products traded around the world are produced by millions of hard-working farmers who end up not making a good living. In other words, the wealth that farmers produce is very conveniently sucked up from the bottom up. Otherwise, I see no reason why farmers should not make a profit either.
This is also true for tech-rich companies that thrive on promoting technological solutions as solutions to agricultural problems. As farmers struggle to make a living, tech company stocks remain bullish.
One wonders why despite all these technological innovations, industrial agriculture is accused of generating a third of global greenhouse gas emissions. Moreover, the real cost of producing cheap food was easily externalised. While input suppliers invariably walk away with profits, society must bear the resulting economic and environmental costs. This cycle continued unabated. Let’s see how artificial intelligence (AI) is trying to redress the balance.
It’s a question Rufo Quintavalle, a Paris-based private investor, asks in the thoughtful essay Food Doesn’t Grow in Silicon Valley that he wrote for the Stanford Social Innovation Review (March 12, 2014): The last hundred years have probably seen more innovation in the food system than at any time in human history, and the common goal of that innovation has been to lower food prices, impoverish farmers and degrade the environment.
In fact, all technological innovations are aimed at improving efficiency and achieving high productivity. These technological innovations should also lead to higher farm incomes. But the fact remains that the more farmers produce, the greater the drop in their income. Take, for example, the case of North America. For more than 150 years, despite very high productivity, the price of wheat to farmers, adjusted for inflation, has been falling sharply. For example, compared to the market price a wheat farmer currently gets in Canada, his great-grandfather would have earned six times as much.
This draws me to Punjab, India’s frontline agricultural state. Despite achieving record annual productivity – among the highest in the world – Punjab has become an environmental mess. Technology has increased crop yield. Instead, excessive groundwater exploitation has dried up aquifers, chemical inputs have become extremely pervasive in the environment, soil fertility is declining, and the burning of crop residues is suffocating the atmosphere. The food bowl was left to cry for a transformation towards a healthy and sustainable agricultural system.
Punjab offers an opportunity to understand how technology politics works. The ongoing debate about saving groundwater reminds me of when, a few decades ago, on a visiting mission to the International Rice Research Institute (IRRI) in the Philippines, I came across a study that said there was no difference in crop productivity if you broadcast the seeds or transplant the paddy seedlings. Intrigued by the findings and well aware that spreading paddy seed had previously been common practice in several parts of Asia, I posed this question to a senior scientist. The response I received was something like this: “We were trying to help the tractor industry. After all, 97% of the rice is grown in Asia, and perhaps the change in cultivation practices was intended to help the tractor industry grow.
Another IRRI study showed that there is no difference in the effectiveness of pesticides if you keep the pesticides at the source of the irrigation flow in a cultivated field or if you use a knapsack sprayer. with different types of nozzles to spray chemicals. It was contrary to what we were taught as students.
With political support, subsidies and the availability of easy credit, farmers are driven to buy more machinery. To illustrate, Punjab has five times more tractors than needed. A former chairman of the Punjab Farmers Commission had asked banks to stop giving cheap loans for tractors. Also, in the name of stubble burning control, over 75,000 machines have already been sold. Presented in batches of five or six, these machines are used for a maximum of three weeks. As more gadgets and tech machines are promoted, farmers are increasingly drawn into a cycle of debt, while equipment makers laugh to the bank.
It’s not very often that we talk about a technology that does not require equipment or machinery to be sold. We are not against technology, but the question that arises is why only a branded technological innovation finds favor. A simple but effective technology like the Nidana model which the late Surinder Dalal perfected against cotton pests, for example, in Haryana has not found many takers for the simple reason that it does not require any machinery. Another example is the System of Rice Intensification (SRI) for rice cultivation. The list is long.
Mechanization is certainly desirable. But in the process of modernization, we must ensure that Punjab does not turn into a dumping ground for machinery. The mindset needs to shift towards sustainable technologies that require fewer external inputs and less machinery.