Statement By National Coalition for Food and Agricultural Research (NCFAR) Before The House Agriculture Committee Subcommittee on Conservation, Credit, Rural Development and Research

Public Hearing June 27 – 10:00 a.m.
1300 Longworth HOB, Washington, DC

REVIEW OF AGRICULTURAL RESEARCH

Thank you, Mr. Chairman for inviting the National Coalition for Food and Agricultural Research (National C-FAR) to testify at this important hearing on food and agricultural research. I am Terry Wolf, a grain producer from Illinois and serve as President of the National C-FAR. Our Coalition looks forward to working with this Subcommittee as we seek to double federal investments in food and agricultural research over the next 5 years.

We want to thank the leadership and members of this subcommittee for passing legislation and supporting the food and agricultural research and education programs that have helped propel the world-renowned success of U.S. food and agricultural sector. We want to keep the U.S. food and agriculture sector at the forefront. We are here today to explain the crucial role that food and agricultural research can play in meeting that important goal.   

I will be hitting the main points but request that the complete statement be included as part of the official hearing record.

In our testimony, we will offer our perspective on four fundamental questions:

1)  Why should the federal government invest in food and agricultural research, extension and education? 

2)  What have been the measurable benefits of federal investments for American farmers and consumers?

3)  Why should we double federal investments in food and agricultural research over the next 5 years?

4)  How should the doubled funds be invested?

The member organizations of our coalition are mindful of the pressing challenges facing U.S. food and agriculture. Several of our members have testified to this Committee in recent weeks relative to the farm bill and many related issues. Yet, despite the importance of addressing today’s pressing national problems, we believe it is important to also address the promising opportunities ahead and the federal policies and programs needed to promote the long-term health and vitality of food and agriculture for the benefit of producers, consumers and the environment. We believe an essential component of any long-term strategy should include increased federal support for food and agricultural research and education.

National Coalition for Food and Agricultural Research (C-FAR)

National C-FAR is a newly organized broad-based stakeholder coalition of some 90 food, agriculture, nutrition, conservation and natural resource organizations. It is a nonprofit, nonpartisan, stakeholder-driven, and consensus-based coalition focused on federal food and agricultural research funding. It is dedicated to fostering public confidence in food, agricultural, nutritional and natural resource research through public participation in planning and evaluating the process and impact of research activities. Membership is open to those who support the objectives of (1) enhancing federal investments in U.S. food and agricultural research and extension, and (2) expanding stakeholder participation in identifying funding needs and opportunities. 

National C-FAR’s goal is to double federal funding of food, nutrition, agriculture, natural resource, and fiber research, extension and education programs during the next five years. This is to be net additional funding on a continuing basis that will complement, not compete with or displace, the existing portfolio of federal programs of research and education.

Why should the federal government invest in food and agricultural research, extension and education?

Importance of Food and Agriculture

Food and agriculture sector is a major contributor to society. Food is fundamental – three times a day for every person on the planet. Food not only maintains life, but it sustains life and provides the basic requirements for a healthy, productive, creative society.

Agriculture creates jobs and income. The food and agriculture sector and their related industries provide over 20 million jobs, about 17 percent of U.S. jobs, and account for nearly $1 trillion or 13 percent of GNP.

Agriculture reduces the trade deficit. Agricultural exports average more than $50 billion annually compared to $38 billion of imports, contributing some $12 billion to reducing the $350 billion trade deficit in the nonagricultural sector.

Agriculture contributes to the quality of life. Farmers provide many valuable and taken-for-granted aesthetic and environmental amenities to the public.  The proximity to open space enhances the value of nearby residential property. Farmland is a natural wastewater treatment system. Unpaved land allows the recharge of the ground water that urban residents need. Farms are stopovers for migratory birds. Farmers are stewards for 65 percent of non-federal lands and provide habitat for 75 percent of wildlife.

Food and agriculture are strategic resources. When food is scarce, peace and democracy are threatened. We have fed our allies during the great wars; we have aided the starving during famines, floods and strife; and we have provided assurances of food that have nurtured the rise of freedom and democracy following the collapse of Communism.

It has been estimated that around the globe that the “Green Revolution”, the science–based improvement in agriculture that has benefited greatly from U.S. food and agricultural research, has saved over a billion lives from starvation and countless millions more from the ravages of disease and malnutrition. In short, our abundant food supply bolsters our national security and eases world turmoil and unrest.

Role and Benefit of Research and Education: High Return on Investment

Many factors have contributed to the unparalleled success of American agriculture - the favorable soils and climate, hard work and dedication of farm families, democratic system, free enterprise, transportation, communication, and government policy, but one factor of undeniable importance was the "Green Revolution" -- the expansion of food production enabled in large part by science-based advances in food and agriculture. Hence, agricultural research and education have played a major role in making the U.S. food and agriculture sector the envy of the world and are essential to keeping it thus.

The contribution of publicly supported agricultural research to advances in food production and productivity and the resulting public benefits is well documented. A recent analysis by the International Food Policy Research Institute of 292 studies of the impacts of agricultural research and extension published since 1953 is summarized in Chart 1. In these nearly 300 studies, spanning a half century, and involving nearly 2,000 separate estimates, the average annual rate of return on public investments in agricultural research and extension was a whopping 81% -- an extremely high rate of return by any benchmark. Clearly, there is hard and compelling facts that prove beyond any doubt those investments in food and agricultural research return enormous benefits to the American people.  

These improvements in agricultural productivity generated by agricultural research and education, while of great importance to the farmer, are broadly shared with society. Half or more of the benefits are transmitted off the farm to consumers in terms of an efficient production system competitive in the global environment; a safe and secure food and fiber system; a healthy, well-nourished population; greater harmony between agriculture and the environment; and a growing economy and improving quality of life. This tremendous pay-off of public investments in agricultural research and education over the past 50 years amount to $3,400 of savings on the food bill of the average American family.

Productivity growth, the increase in yield per acre, milk per cow, etc., measured as aggregate output per unit of aggregated inputs, has grown very rapidly in agriculture at an annual pace of 1.9% -- nearly double the pace of 1.1% in the non-farm business sector. Productivity in agriculture has more than doubled in the past 50 years. In fact, as Chart 2 shows, over the past 50 years, agriculture production has more than doubled, while the aggregate of all tangible inputs has actually declined by about 10%. In other words, all the increase in U.S. agriculture production for the past 50 years has been due to increased productivity, not due to more inputs. Research and education, both public and private, have been the prime driver of this productivity growth.  

Saving Land and the Environment

Advances in agricultural productivity have contributed to the environment and the quality of life. In his speech to the National C-FAR Inaugural meeting on January 30, 2001, Dr. Norman Borlaug, the Nobel Peace Prize recipient and one of the most distinguished agricultural scientists in the world, stated: 

“American farmers and ranchers not only have been able to increase agricultural production many-fold through the application of science and technology, I contend that they have also been able to achieve these production feats in ways that have helped conserve the environment, not destroy it. For example, had the U.S. agricultural technology of 1940 …still persisted today we would have needed an additional 575 million acres of agricultural lands—of the same quality—to equal the 1996-97 of 700 million tons for the 17 main food and fiber crops produced in the United States [Chart 3].

“Put another way, thanks to the agricultural productivity increases made possible through research and new technology development, an area slightly greater than all the land in 25 states east of the Mississippi River has been spared for other uses. Imagine the environmental disaster that would have occurred if hundreds of millions of environmentally fragile lands, not suited to farming, had been ploughed up and brought into production. Think of the soil erosion, loss of forests and grasslands, and biodiversity, and extinction of wildlife species that would have ensued!”  

Minimizing Healthcare Costs through Disease Prevention

Nutrition and diet-related research discoveries benefit everyone. New technologies are needed to reduce the likelihood of pathogen transmission by food, to improve the quality of processed foods, and to deliver greater nutritional value in foods. Additionally, the healthcare costs reduced by advances in nutrition research have saved the American taxpayer untold millions. As health costs continue to rise, it is imperative that our medical practices take a preventive approach.  This requires a thorough understanding of the role of nutrients in foods in preventing chronic illnesses such as heart disease, cancer and diabetes.

Research in food safety and human nutrition has paid-off with considerable benefits to society. It complements the funding of disease-related research by focusing on prevention through diet and nutrition. An important new area of nutrition research is to discover how foods and food components (not typically thought to be traditional nutrients) can prevent various diseases throughout the lifecycle. Research on the content, availability, and safety of the food supply is extremely useful to the consumer by achieving optimal health in using agricultural commodities as part of our diets. This investment in nutrition research increases knowledge that prevents diseases and ensures a healthy and productive society.

Examples of Real Life Impacts of Research and Education

In addition to these careful and comprehensive statistical measures and explanations of the benefits of the public’s investment in food and agricultural research, there are literally hundreds of specific examples of success we could cite. We are including a few research and education success stories with this testimony to “put a face on” food and agricultural research and education and provide some concrete examples of the impacts and benefits.

Why Federal Funding Of Food & Agricultural Research?

Private firms undertake research if they expect that the funds invested will yield a positive net return to them. Private firms have an incentive to invest in research and development where the result is such that it can: 1) be embodied in a product or service that has a market, 2) be protected by intellectual property rights, and 3) generate a payback in the near term. In areas where these conditions are met, private research funding is likely and desirable for our economy.

Publicly financed research should be complementary to private research. It should not compete with or crowd-out private research but focus in areas where the private sector does not have an incentive to invest. Information, one of the main drivers of our economy today, indeed the term used to name our present age, shares many characteristics with research which often necessitate some public support. Research, like information, is costly to produce but cheap to reproduce, so private markets for some types of research may be inefficient. Accordingly, public research is appropriate in areas where: 1) the pay-off is over a long term, 2) the potential market is more speculative, 3) the effort is during the pre-technology state, and 4) the benefits are widely diffused and difficult for a private firm to embody in a product or service, protect its property rights and capture the benefits through the marketplace. Public research helps us measure long-term progress. It also acts as a means to catch problems in an early stage, thus saving American taxpayer dollars in remedial and corrective actions.

Examples of areas where private firms are not likely to have sufficient incentive and public support may be warranted include such areas as: 1) basic science and fundamental knowledge, 2) enhancing environmental quality, 3) food safety and security, 4) improving public policy, and 5) pre-technology areas.

Chart 4 shows the hypothetical costs and benefits of food and agricultural research which can be used to illustrate the principles guiding the respective roles of private and federal funding. Research costs are normally incurred several years before the technology is developed and adopted. In our example in Chart 4, the benefits that can be captured by a private firm are colored blue and have an annualized return (an internal rate of return) of 15% on the research costs. The 15% return may be insufficient incentive for the firm. But there may be substantial benefits that accrue to society at large in addition to the private benefits that can be captured by the firm. In our hypothetical case, the public plus private benefits generate a 25% annual return. In this case federal investment may be warranted.  

An example of the distinction of benefits that can be captured by a private firm versus those that cannot would be research on row width and seeding rate. Such research produces information which can be widely used but would be difficult to exclude from others or require users to pay for using the information. The benefits of research embodied in a hybrid variety, which can not be saved for seed and replanted, are much easier to exclude use of others than the use of a non-hybrid variety.  

One may also think of the blue benefits as those accruing to a state from a State Experiment Station Project, which is not justified by the benefits to the one state alone but may be justified when we consider all states and therefore the merits of multi-state collaboration or federal support. For example, the benefits of research conducted on animal diseases in one state are likely to “spill-over” and aid livestock producers in neighboring states or the entire nation.

The benefits of extension and education, in terms of Chart 4, can be visualized as accelerating or quickening the benefit stream. Extension education serves to speed adoption and use of research results and hence increases its payoff to society. Extension does more than accelerate adoption and use; it also helps identify the problem in the first place and provides timely feedback during the development and adoption phases.         

Why should we double food and agricultural research?

Pressing Problems

George Washington once remarked that “there is no more important service than to improve agriculture.”  We should double food and agricultural research in the next five years for three basic reasons: First, despite the progress and contributions in the past, many challenges remain. Second, federal funding of food and agricultural research has been essentially flat for two decades and we are in danger of having the scientific base, upon which food and agriculture advances have been built, erode. Third, there will be opportunities lost or innovations that will not occur unless there is increased support. Research helps justify or minimize the risk of investment which produces the next generation of solutions. 

World food demand is escalating. World population and income growth are expanding the demand for food and improved diets. World food demand is projected to double in 25 years. Most of this growth will occur in the developing nations where yields are low, land is scarce, and diets are inadequate. Without a vigorous response the demand will only be met at a great global ecological cost.

Food-linked health costs are high.  Some $100 billion of annual U.S. health costs are linked to poor diets and food-borne pathogens.

Farm income is low.  U.S. farmers are suffering from some of the lowest prices in over two decades. Emergency federal farm assistance programs are spending record sums to avert a catastrophic farm situation. Longer term approaches to the assist farmers cope with volatile prices are needed. Indeed, there was much discussion during the 1996 farm bill that expanded food and agricultural research could enhance competitiveness and opportunities and be an engine for growth. But the major commitment to expanded research has not yet materialized.

Food safety concerns and expectations are rising. Some of the new food products based upon genetically modified organisms are raising increased public awareness and concern about the safety of our food supply.

A better understanding of the ecosystem and more environmentally friendly practices can lead to reduced threats to our environment and improved sustainability.

Energy costs are escalating, our dependence on petroleum imports is growing and our concerns about greenhouse gases are rising. Agriculture provides the potential for renewable sources of energy and cleaner burning fuels that will reduce are dependence upon petroleum imports.

The need for bio-security and bio-safety tools and policies to protect against bio-terrorism and dreaded problems such as foot-and-mouth and “mad cow” diseases and other exotic plant and animal pests, protection of range lands from invasive species, new ways of sustaining agricultural productivity and production growth, and solutions to the environmental issues related to global warming, limited water resources, competing demands for land and other agricultural resources, are major challenges for the research and education agenda.

Stagnation and Decline

Federal funding of food and agricultural research has been stagnant. It has declined relative to all federal research and relative to agricultural research in the rest of the world.

Federal funding of food and agricultural research in the USDA, measured in real (inflation-adjusted) dollars is less than it was in 1978 (Chart 5). In 1978, in constant dollars, USDA food and agricultural research and education funding was $1.64 billion, in 2000 the funding was $1.6 billion.   

Federal funding of agricultural research has not kept pace with funding of all federal research. According to The National Science Foundation, total federal research funding during 1982 to 1998 increased in constant dollars, but funding of agricultural research decreased. The agriculture research share of the federal total has fallen from 4.2% to 2.5% (Chart 6).  

We may be in danger of falling behind research in other countries. Public funding of agricultural research in the rest of the world outside the U.S. during 1971-1993 increased nearly 30% faster pace than in the U.S. (Chart 7). While we still have the leading public supported food and agricultural research and education program in the world, our edge is shrinking. 

In this Internet Age of global agriculture, the international transfer of technology across borders is accelerating, making it much more difficult to sustain our lead unless we increase our federal support.  Currently, we only invest about $1 of federal funds of agricultural research per every $500 of consumer expenditures of food and fiber – a very low rate indeed (Chart 8)!  

Expanding Opportunities

The third reason, but perhaps most important one, for doubling food and agricultural research is to capitalize upon the promising opportunities that advances in science and technology make possible. Advances in science and technology are opening the way to tremendous opportunities such as the sequencing of the human, plant, and animal genomes. Taking advantage of these unprecedented biotechnological advances will require significant increases in research funding. If we do not, the technological advantage the U.S. now enjoys in these areas will be lost. This loss or our scientific leadership will have a very adverse impact on our use of new technologies that will fuel our economy over the next decades. 

How Should the Doubled Funds Be Spent?

Goals

WhiWhile our coalition is initially directing our efforts to securing a doubling of federal food and agricultural research funding, our ultimate goal is not budgetary, but the many benefits that the fruits of research and education will produce for each American.

We believe increased funding of food and agricultural research will result in:

• Safer, more nutritious, convenient and affordable foods

• More efficient and environmentally friendly food, fiber and forest production

• Improved water quality, resource conservation and environment

• Less dependence on non-renewable sources of energy 

• New and improved products, expanded global competitiveness and improved balance of trade

• More jobs and sustainable rural economic development

• Better protection for our agricultural and natural resources  from new, emerging, and imported plant pests and animal diseases

While National C-FAR does not have a list of research project recommendations, through our members and their association with other related coalitions, we are well aware of urgent research needs to address and opportunities to explore.

Authorization & Leveraging

Legislative authorization of food and agricultural research and education is in several major pieces of legislation including the Hatch Act of 1887, the Smith-Lever Act of 1914 and most recently the Agricultural Research, Extension, and Education Reform Act of 1998. Several key provisions of the 1998 Act expire in 2002. National C-FAR recommends that:

1) The basic authorizations and provisions of the 1998 Act be extended and incorporated in the new farm bill

2) An additional provision be included that it is the sense of Congress that federal funding of research, extension, and education be doubled over the next five years

3) Provisions be strengthened to expand stakeholder participation in identifying research and education funding needs and opportunities

The current definition of “food and agricultural sciences” in Chapter 64- Agricultural Research, Extension and Teaching, Section 7, Paragraph 3103 (8) is “basic, applied and developmental research, extension, and teaching activities in the food, agricultural, renewable natural resources, forestry, and physical and social sciences in the broadest sense of these terms.” We support a broadening of this definition to include expanded global market opportunities and protection from exotic weed, insect or disease organisms. We also support a better identification of the various food and agricultural research programs throughout the federal government and improved the coordination of these programs. The challenges and opportunities of the food and agricultural sector require the interest, support, and participation of all federal agencies. 

Building Capacity and a Balanced Portfolio

National C-FAR and its member organizations have identified several emerging needs and opportunities which we soon will explain, but we first want to emphasize the continuing need to build the capacity to do quality research and education, including human resources, competitive grants, infrastructure support, formula funds, and core programs. Research and education is the foundation of knowledge upon which the food and agricultural sector depends. This foundation must be kept strong, lest it crumble and curtail the strength and expansion of this trillion dollar sector. Even to maintain existing productivity, substantial maintenance research is necessary. Discovery is a continuous process that must be ongoing, not a one-time eureka moment. 

It is important to maintain a balanced portfolio of federal research and education programs, including competitive grants, formula funds and intramural programs. Agriculture is a biologically based industry. Many of the problems and opportunities are site specific. Results must be adapted to fit local conditions. Hence, we need to maintain a diversified and decentralized research and education system.

Areas of Opportunity

Several coalitions, committees and scientific societies, including those listed below, have identified these needs and opportunities:

• Coalition for Research on Plant Systems - CROPS ’99

• Food Animal Integrated Research for 2002 --FAIR 2002

• Institute of Food Technologists – Food for Health Research Needs

• Council on Food, Agricultural, and Resource Economics --Economics and Research Priorities for an Efficient and Sustainable Food System

• American Society for Nutritional Sciences

• National Agricultural Research, Extension, Education, and Economics Advisory Board

• American Dietetic Association

Members of our Research Committee have presented to our Board a compilation of these studies. 

Major areas of research that have been commonly identified by most, if not all, of the related coalitions that are in need of additional funding include:

• Food security, safety, fortification, enrichment and allergens
• Nutrition and public health 
• Production quantity and quality; nutrient adequacy; global competitiveness; and new market opportunities
• Environmental stewardship and resource conservation and the scientific basis for public policies relating to the environment, plants and animals 
• Increasing knowledge, skills, and expertise   
• Emergency preparedness for emerging plant and animal diseases and bio-terrorism
• Product pioneering for food, nutrition, biobased materials and biofuels
• Genetic resources, genetic knowledge, and biotechnology
• Jobs and rural community economic vitality
• Education and outreach to producers, processors and consumers including food safety, sound nutrition, conservation, management, and new technology

Our coalition arose from a shared concern about the capacity of our agricultural research system as a whole to meet the future demands and capitalize on emerging opportunities.  We will need a research system that simultaneously satisfies needs for food quality and quantity, resource preservation, producer profitability and social acceptability.  This coalition will be working on ways to help assure that these needs are met.

Conclusion

In conclusion, we hope we have convinced you that:

1) Food and agriculture is an important sector that merits federal attention and support.

2) Food and agricultural research and education have paid huge dividends in the past, not just to farmers, but to the entire nation and the world.

3) There is an appropriate and recognized definable role for federal support of research and education.

4) Federal investments in food and agricultural research should be doubled over the next 5 years.

We believe doubling of federal food and agricultural funding is a strategic and sound investment that would: 1) benefit producers and consumers of all commodities and all states; 2) improve income opportunities for farmers; 3) contribute to the United States remaining the best fed country with the lowest share of income spent on food; 4) strengthen our competitiveness in the global marketplace, while achieving the proper balance with human and environmental needs; 5) enable producers to produce safer, healthier foods; 6) find new uses for agricultural products; and 7) enhance the protection of our renewable natural resources.

Again, we appreciate the opportunity to share our views. We look forward to working with you and the members of this Subcommittee in support of these important long-term objectives.