Final Draft

The production and consumption of corn has long been considered a primary activity by primitive and now advanced cultures; which has spurred international trade and recently boosted the importance of the American agriculture industry on an international stage. Traditionally used for livestock feed and for human consumption the uses of this commodity have greatly expanded to being used for the production of high-fructose corn syrup, plastics, adhesives, chemicals, dyes, pharmaceuticals, anti-freeze, soaps, and various other products that have become essential to everyday life (Gibson, Benson). This essential crop has come to take over most of the available agriculture landscape in the United States. However, the overuse of essential minerals in the soil have led to questioning whether or not the consistent production of the same crop is good for the land, and if it is worth it for us to produce so much of this inedible corn that is used mostly for feed and other products. Supporting the production of cheap goods that might require more and farther trade in order for people to have essential products and food are supranational organizations. These organizations, like the EU and NAFTA, create incentives to maximize profits per acre and cause farmers and manufacturers not to focus as much on regional demand and use because consumers will still be able to get what they need in the form of imports that are taxing on the environment and cause an increase in reliance on other nations.

The globalizing economy has caused the American agriculture economy to make the shift from subsistence agriculture to commercial agriculture as the reason for farming is no longer to feed the cities near bye but to maximize profits. The expansion of the available uses of corn has caused farmers to recognize the importance of the commodity and has led to fleeting production of edible corn. Over the past forty years corn has become recognized for its versatility in the economy. Primarily, ethanol production and use has increased dramatically due to high-energy costs, pollution and foreign oil dependency. (Olson, Klien, Taylor, 2007). This new industry has had widespread effects on the American economy after even more emphasis was placed on the fuel after President Bush created incentives and loan guarantees for ethanol use following increased public interest on the environment. It’s estimated that in 2006 the ethanol industry increased gross output to the American economy by $41.9 billion, supported the creation of 160,034 new jobs in all sectors of the economy, including more than 20,000 in the manufacturing sector, and put an additional $6.7 billion in the pockets of American consumers. (Olson, Klien, Taylor, 2007). Due to these incentives the demand for corn and the average price per metric-ton have both seen increases since 2005. Creating a need for more corn production has also yielded larger profits for domestic companies and has stimulated more global trading.

In the 1970’s, the notion to replace sugar with corn syrup became extremely popular due to its cheapness, ease of production, and widespread availability. (Rasheed, 2009) Today corn syrup is a key ingredient in most processed products as a substitute for sugar, notably soft drinks, high domestic sugar prices create a haven, and market, for corn syrup producers. (Runge, 2002).  This high demand for corn syrup has led to a sharp decrease in the domestic sugar industry, increasing global trade as Americans are now forced to seek sugar from other countries. Also, the major corporations involved in Ethanol production have heavily relied on outsourcing the production from raw corn to fuel due to lower standards of the quality of the corn as well as cheaper labor and land.

The recent shift from small sustainable farms to large global food manufacturing farms in order to provide for the world population, “corn is by far the largest component of global coarse-grain trade, accounting for about three-quarters of total volume in recent years (coarse grains make up a common trade category that includes corn, sorghum, barley, oats, and rye).”( Credit and Finance; 2010) One of the driving forces and barriers behind the high volume trade of corn is The North American Free Trade Agreement, or NAFTA. NAFTA is an agreement between Canada, the United States, and Mexico to create a trade bloc and to allow free flowing trade and enterprise between the three nations and to limit tariffs from being set and implemented in the countries. Traditionally and too this day the largest commodity import from America to Mexico has been yellow corn. However from 1998-2002 America also began to export large quantities of white corn. The production of these two varieties is contained by each nation, Mexico producing white corn and the United States producing yellow corn. White corn is used primarily for direct human consumption; while most yellow corn is used to make animal feed, ethanol, corn starch, and other products. Yellow-corn can also be produced at food-grade, which is generally made into corn flakes, chips and beer.  This increase in trade led to decreasing rates of production in the Mexican agriculture sector, until the government began supporting Mexican corn farms through aid in advertisement. Even with the declining rate of exported white corn the average amount of corn exported from the United States to Mexico is still rising as their hog and poultry industry continues to boom, creating a demand for consistently lager yellow corn imports in order to accommodate the in expanding industry. The expanding demand for corn in Mexico coupled with lagging production is occurring at an ideal time for the United States, as all trade barriers on corn were canceled in 2008; fostering a feeling of continued heavy export of corn to Mexico.

How do these government incentives for corn based products and the breaking of barriers of trade negatively and positively affect sustainability on both a national and world wide level? I think it is noticeable that while degrading the success of national sustainability, due to a reliance on imports and an inability to use the local products to produce food, it is promoting global sustainability. Treaties like NAFTA have led to a dispersment of capital among more nations and have created lower and more affordable prices for food and other products around the world. To me this poses the question, is it more important that my corn come from a local farm that didn’t expend pollutants, or is it more important that a starving family was able to afford their food.

 

As a supplement to my predominately research based project I have continued my research with graphs and charts that look into areas relating to social trends as well as American use of corn and our use of our limited fertile land conducive to crops that could be used more domestically and increase domestic sustainability.

I would first like to look at the amount of corn produced in America in comparison to the production rates in the European Union and other major corn producers. In 2010 America produced about 40 percent of the world’s corn with 331 million metric tons harvested (I used just the weight in tons rather than graphs for this because of differences in measurement systems in American agriculture and the rest of the world). When comparing this to European Union production it is hardly comparable, with their largest producer, France, harvesting only about 14,000,000 tons in 2007; and total European production reaching about 50,000,000 tons. Although the whole of the EU’s landmass is slightly smaller than that of America’s the ratio of corn production is massively skewed, leaving more agriculture land and work power for other crops to avoid importing large amounts to sustain their populations demand.

The following graph shows corn production in America compared to other major producers around the world, still showing America to be dominant in production of corn. China follows with 19.5 percent of world production, but continues to be one of the largest importers, as will be shown further down the page, due to its large population and hunger crisis. Although Brazil is currently increasing corn production due to large government subsidies being offered for ethanol production these two major producers of the worlds most popular and essential grain lays in the breadbasket of America.

 

The production of corn in the past century has not run congruent with other crops, most of which have maintained relatively stable levels despite rising populations and increases in international trade. The graph below illustrates the production of corn, oats, hay, soybeans, and corn. Traditionally the highest producing crop in America following introduction by the Mayans it’s production continued to increase at a relatively stable rate along with the other crops. Then around 1950, following the end of American isolation policy and expanding uses for corn in soaps and industrial supplies production rates began to increase much faster than before. Spiking again in the mid 1960’s following the development of high-fructose corn syrup and it’s popularity in soda the growth became exponential, far trumping any other crops produced in the United States. This trend continued, seeing other spikes with increased ethanol production and the government incentives that accompanied it.

The spike noticed in the above graph in the mid 1960’s is represented below with the introduction and explosion of corn based sweeteners in several products found in grocery stores around the world.

With so much domestic production of corn, a staple in any diet, sufficient enough to maintain life on it amazes me that there continues to be so much hunger in our nation. That is until exploring the primary uses for the yellow corn predominantly grown in America and all around Wisconsin. When looking at the uses breakdown on the graph below it becomes clear where all of this corn goes. It is mostly used as animal feed, as it is apparently more important to feed money making commodities than dying humans. Most of the remaining corn is used for the production of ethanol and for export (in any form of corn). Leaving only a menial number, lost in the six percent category, for human consumption within American borders; this statistic represents the transformation of corn, a life source to primitive cultures, to a money making commodity fueled by capitalism and the expectations of maximized profits

Following the introduction to the project I was very interested in doing research on where the farms around Madison send their corn as well as where our supermarket corn is coming from. I also intended to investigate the origins of the corn used by some of the major corn syrup and ethanol producers of America. All three of these tasks were more difficult to obtain then initially intended. Farmers, in my experience, are not generally willing to give up the names of their high volume customers, especially in a down market with the price of corn in the commodity index returning back to average prices. Most people I was able to even get in contact with would just say they are not legally allowed to release the names or prices of their product due to contract infringement. I was met with similar results at Madison Market and Metcalf as employees and on site management rarely know the origins of the products they are providing. When I moved onto researching the production of ethanol and corn syrups I noticed a similar trend, a stamp declaring their product is made in America; with small print “of American or imported goods.” I quickly realized that when met with a college aged student asking questions about their products most producers and farmers do not like to answer questions, because of this I went on to explore the graphs I had found and link the numbers with the concepts of widespread trade, an overuse of land for one crop, and the use of this crop for things other than human consumption.

Work Cited

Ackerman, F, Wise, T, Gallagher, K, Ney, L, & Flores, R. (2003, June). Free trade, corn,       and the environment: environmental impacts of us – mexico corn trade under nafta. 3(6), Retrieved from http://ase.tufts.edu/gdae/pubs/wp/03-06-naftacorn.pdf

Corn Commodity Market—Credit and Finance Risk Analysis (2010). Retrieved from             http://www.credfinrisk.com/corn.html

Gibson, L, & Benson, G. (2002). Origin, history, and uses of corn . Unpublished       manuscript,       Department of Agronomy, Iowa State University, Ames, Iowa. Retrieved from             http://www.agron.iastate.edu/courses/agron212/readings/corn_history.htm

Heimlich, R. 1998, ‘Precision Agriculture Information Technology for Improved  Resource Use’. Accessed 20 September 2010,from< http://www.ers.usda.gov/publications/agoutlook/apr1998/ao250f.pdf&gt;

Runge, Ford. (2002, September). King corn: the history, trade and environmental consequences    of corn (maize) production in the united states*. Retrieved from http://www.worldwildlife.org/what/globalmarkets/agriculture/WWFBinaryitem7205.pdf

King corn. (2008, Febuary 29). Retrieved from http://www.pbs.org/independentlens/kingcorn/

Kucharik, C, & Ramankutty, N. (2005). Trends and variability in u.s. corn yields over the twentieth century. Earth Interactions, 9(1),

Retrieved from http://www.sage.wisc.edu/pubs/articles/F-L/Kucharik/Kuch2005EarthInt.pdf

Olson, A, Klien, N, Taylor, G. 2007, ‘The Impact of Increased Ethanol Production on Corn Basis in South Dakota’. Accessed 23 September 2010 from< http://ageconsearch.umn.edu/bitstream/10255/1/sp07ol03.pdf>http://ipm.ncsu.edu/safety/factsheets/pestuse.pdf

World Corn Consumption: China & U.S. Account for Over Half (2009, December 17).Retrieved from http://www.cattlenetwork.com/World-Corn-Consumption—China—U-S–Account-For-Over-Half/2009-12-17/Article.aspx?oid=967922&fid=VN-INTERNATIONAL-EU

Introdcution

The production and consumption of corn has long been considered a primary activity by primitive and now advanced cultures; which has spurred international trade and recently boosted the importance of the American agriculture industry on an international stage. Traditionally used for livestock feed and for human consumption the uses of this commodity have greatly expanded to being used for the production of high-fructose corn syrup, plastics, adhesives, chemicals, dyes, pharmaceuticals, anti-freeze, soaps, and various other products that have become essential to everyday life (Gibson, Benson). This essential crop has come to take over most of the available agriculture landscape in the United States. However, the overuse of essential minerals in the soil have led to questioning whether or not the consistent production of the same crop is good for the land, and if it is worth it for us to produce so much of this inedible corn that is used mostly for feed and other products. Supporting the production of cheap goods that might require more and farther trade in order for people to have essential products and food are supranational organizations. These organizations, like the EU and NAFTA, create incentives to maximize profits per acre and cause farmers and manufacturers not to focus as much on regional demand and use because consumers will still be able to get what they need in the form of imports that are taxing on the environment and cause an increase in reliance on other nations.

The globalizing economy has caused the American agriculture economy to make the shift from subsistence agriculture to commercial agriculture as the reason for farming is no longer to feed the cities near bye but to maximize profits. The expansion of the available uses of corn has caused farmers to recognize the importance of the commodity and has led to fleeting production of edible corn. Over the past forty years corn has become recognized for its versatility in the economy. Primarily, ethanol production and use has increased dramatically due to high-energy costs, pollution and foreign oil dependency. (Olson, Klien, Taylor, 2007). This new industry has had widespread effects on the American economy after even more emphasis was placed on the fuel after President Bush created incentives and loan guarantees for ethanol use following increased public interest on the environment. It’s estimated that in 2006 the ethanol industry increased gross output to the American economy by $41.9 billion, supported the creation of 160,034 new jobs in all sectors of the economy, including more than 20,000 in the manufacturing sector, and put an additional $6.7 billion in the pockets of American consumers. (Olson, Klien, Taylor, 2007). Due to these incentives the demand for corn and the average price per metric-ton have both seen increases since 2005. Creating a need for more corn production has also yielded larger profits for domestic companies and has stimulated more global trading.

In the 1970’s, the notion to replace sugar with corn syrup became extremely popular due to its cheapness, ease of production, and widespread availability. (Rasheed, 2009) Today corn syrup is a key ingredient in most processed products as a substitute for sugar, notably soft drinks, high domestic sugar prices create a haven, and market, for corn syrup producers. (Runge, 2002).  This high demand for corn syrup has led to a sharp decrease in the domestic sugar industry, increasing global trade as Americans are now forced to seek sugar from other countries. Also, the major corporations involved in Ethanol production have heavily relied on outsourcing the production from raw corn to fuel due to lower standards of the quality of the corn as well as cheaper labor and land.

The recent shift from small sustainable farms to large global food manufacturing farms in order to provide for the world population, “corn is by far the largest component of global coarse-grain trade, accounting for about three-quarters of total volume in recent years (coarse grains make up a common trade category that includes corn, sorghum, barley, oats, and rye).”( Credit and Finance; 2010) One of the driving forces and barriers behind the high volume trade of corn is The North American Free Trade Agreement, or NAFTA. NAFTA is an agreement between Canada, the United States, and Mexico to create a trade bloc and to allow free flowing trade and enterprise between the three nations and to limit tariffs from being set and implemented in the countries. Traditionally and too this day the largest commodity import from America to Mexico has been yellow corn. However from 1998-2002 America also began to export large quantities of white corn. The production of these two varieties is contained by each nation, Mexico producing white corn and the United States producing yellow corn. White corn is used primarily for direct human consumption; while most yellow corn is used to make animal feed, ethanol, corn starch, and other products. Yellow-corn can also be produced at food-grade, which is generally made into corn flakes, chips and beer.  This increase in trade led to decreasing rates of production in the Mexican agriculture sector, until the government began supporting Mexican corn farms through aid in advertisement. Even with the declining rate of exported white corn the average amount of corn exported from the United States to Mexico is still rising as their hog and poultry industry continues to boom, creating a demand for consistently lager yellow corn imports in order to accommodate the in expanding industry. The expanding demand for corn in Mexico coupled with lagging production is occurring at an ideal time for the United States, as all trade barriers on corn were canceled in 2008; fostering a feeling of continued heavy export of corn to Mexico.

How do these government incentives for corn based products and the breaking of barriers of trade negatively and positively affect sustainability on both a national and world wide level? I think it is noticeable that while degrading the success of national sustainability, due to a reliance on imports and an inability to use the local products to produce food, it is promoting global sustainability. Treaties like NAFTA have led to a dispersment of capital among more nations and have created lower and more affordable prices for food and other products around the world. As I continue this projects I am going to continue to explore the question of national or global sustainability is more important to achieve, while also exploring the effects of the expansive trade networks on the environment and local economies around the world.

What I would like to do in order to explore this shift in corn production and use is to look at where local grocery stores get their corn and to look at the potential price differences in the various origins of the corn. I would also like to look at where corn based products such as certain adhesives, corn-syrup, and other products are manufactured and where their corn supply comes from. I want to look at how trade leads to cheaper prices and based on a cost-benefit analysis is it worth it to put this burden on the environment while we feed the world population.

Work Cited

Ackerman, F, Wise, T, Gallagher, K, Ney, L, & Flores, R. (2003, June). Free trade, corn,       and the environment: environmental impacts of us – mexico corn trade under nafta. 3(6), Retrieved from http://ase.tufts.edu/gdae/pubs/wp/03-06-naftacorn.pdf

Corn Commodity Market—Credit and Finance Risk Analysis (2010). Retrieved from             http://www.credfinrisk.com/corn.html

Gibson, L, & Benson, G. (2002). Origin, history, and uses of corn . Unpublished       manuscript,       Department of Agronomy, Iowa State University, Ames, Iowa. Retrieved from             http://www.agron.iastate.edu/courses/agron212/readings/corn_history.htm

Heimlich, R. 1998, ‘Precision Agriculture Information Technology for Improved  Resource Use’. Accessed 20 September 2010,from< http://www.ers.usda.gov/publications/agoutlook/apr1998/ao250f.pdf&gt;

Runge, Ford. (2002, September). King corn: the history, trade and environmental consequences    of corn (maize) production in the united states*. Retrieved from http://www.worldwildlife.org/what/globalmarkets/agriculture/WWFBinaryitem7205.pdf

King corn. (2008, Febuary 29). Retrieved from http://www.pbs.org/independentlens/kingcorn/

Kucharik, C, & Ramankutty, N. (2005). Trends and variability in u.s. corn yields over the twentieth century. Earth Interactions, 9(1),

Retrieved from http://www.sage.wisc.edu/pubs/articles/F-L/Kucharik/Kuch2005EarthInt.pdf

Olson, A, Klien, N, Taylor, G. 2007, ‘The Impact of Increased Ethanol Production on Corn Basis in South Dakota’. Accessed 23 September 2010 from< http://ageconsearch.umn.edu/bitstream/10255/1/sp07ol03.pdf>http://ipm.ncsu.edu/safety/factsheets/pestuse.pdf

World Corn Consumption: China & U.S. Account for Over Half (2009, December 17).Retrieved from http://www.cattlenetwork.com/World-Corn-Consumption—China—U-S–Account-For-Over-Half/2009-12-17/Article.aspx?oid=967922&fid=VN-INTERNATIONAL-EU

Sustainability

For my project I am going to look at domestic sustainability and the effect that large farms have on it. I am going to look primarily at corn production in America, especially in the mid-west, and what positive and negative effects the focus on this one crop has, as well as the effects of corn production on other crops and the ability to produce a diverse range of crops that could remain locally sold rather than shipped all around the world for animal feed, corn syrup, and other uses found for this type of corn.