Iowa State University agricultural economist Wally Huffman is very optimistic about the next 10 years in agriculture.
Dramatic price fluctuations, increasing demand, the food vs. fuel debate, and other events of the past year may have food producers wondering which way is up.
Despite these recent uncertainties, ‘up’ is precisely the direction an Iowa State researcher believes agriculture is headed for at least the next 10 years.
Huffman, professor in agricultural economics and Charles F. Curtiss Distinguished Professor in Agriculture and Life Sciences, predicts supply will go up, demand will go up, and real prices of grain and oilseeds also will go up.
“Supply is going up, and demand is going up,” he said. “I think they will grow at a similar pace. There will be occasional spikes due to bad weather and abrupt restriction in crude oil production, but prices will come down. When they do, they will come down to similar levels to what they are now in real terms, and those are pretty good prices.
“For the past 100 years, on average, real agricultural product prices have been falling as technology has been allowing supply to increase faster than demand,” he said.
But for the past decade, demand has been rising as quickly as supply, he added.
Huffman also believes that rapid improvement in plant genetics, thanks to biotechnology, will rise much faster than in the past 50 years.
“In the case of corn, since 1955 the average rate of increase in Iowa crop yield has been two bushels, per acre, per year,” said Huffman. “That’s an amazing accomplishment starting from about 65 bushels, per acre, per year in 1955, up to about 165 bushels, per acre, per year now.”
Huffman thinks the future will be even better.
“From 2010 to 2019, corn yields are going to increase quite substantially, maybe at four to six bushels, per acre, per year,” he said.
Much of the increase will be due to genetic improvements in hybrid corn varieties associated with new, multiple stacking of genes for insect protection and herbicide tolerance that will permit a major increase in plant populations.
These improvements are the result of corn that has been genetically modified (GM) to have certain desirable traits.
Also, better equipment, improved farm management, and reduced- and no-till farming will contribute to rising corn yields in the Midwest.
Other commodities have also improved yield and will likely see continuing increases, according to Huffman.Soybean yields in Iowa also are increasing, although less dramatically than corn, says Huffman.
Read Huffman’s full report “Technology and Innovation in World Agriculture: Prospects for 2010-2019.”