Next Generation Farming

Going Organic: Easier Said Than Done

Would consumers be willing to pay significantly higher prices for food?

After living in Chicago for several years after college, I discovered that the people there love their food. Naturally, organic food is a hot topic. A friend of my fiancée's even gave us some advice - that we had better jump on the bandwagon and go organic because it's the way of the future.

Well, that may make a lot of sense if you're someone who shops exclusively at an upscale organic food store and all the food you buy is organic. But at the grower level, things get a bit more complicated.

Like any specialty market, organic is a small market that can be easily oversupplied, and the premiums paid to growers can be unpredictable. Meeting quality standards is also difficult when you can't control bugs and weeds with the use of insecticides and herbicides.


And if you're in a remote area like western
Kansas, it gets especially difficult when you try to compete for contracts in those far-away urban niche markets where you find the majority of high-paying consumers.


Still, there's a strong contingency of Americans who truly believe that the
U.S. will someday be an organic nation, and I've met a good share of them over the years while living in the city. The problem they forget about, though, is that there just aren't that many people willing to pay significantly higher prices at the grocery store. I'm one of them!


When you run some basic figures, the expectation of
America's wheat farmers turning completely organic doesn't pencil out.


Flour power
Based on a U.S. population of 308.8 million people and annual per capita flour consumption at 136.6 pounds, that comes to 42.2 billion pounds of flour consumed in the U.S. every year. And with one bushel of wheat yielding 42 pounds of flour, that means Americans eat about 1 billion bushels of wheat every year.

But in the U.S. we produce far more wheat than that - up to 2.5 billion bushels of wheat per year. So if everyone in the U.S. switched to buying organic, that still leaves about 1.5 billion bushels of wheat left over (not accounting for any loss in production, which would inevitably happen in organic farming).


Would all that leftover wheat be organically grown, also?


Only if our overseas customers in places like
Nigeria, Egypt and Japan insist on it. And with the price of organic wheat being as much as 50% higher than conventional wheat, it's going to be hard to find a customer overseas who's willing to pull out their cash for U.S. wheat when they can get it cheaper somewhere else in places like Russia and Ukraine.


So if more Americans want to buy organic, that's great news for growers in the organic market. But expecting our entire production system to turn organic? That's not so easy.  

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