Commercial Agriculture

1
Chapter 8-3

• Commercial Agriculture
• Production Control
• short supply should command an increased market
  price (after typhoon in Asia, vegetable price
  going up)
• government control prices either too high or too
  low. (farm economy distorted while low food price
  is enforced, material distortion while stop
  importing and subsidizing)
• Todays contractual arrangement in the U.S. up
  to 1/3 from 10 within 50 years.
• Older supply/demand market price mechanism is
  not totally valid
• crop or livestock mix selected by commercial
  farmers reflects an assessment of market demands
  and prices
• involves intensive land use near markets and
  extensive land use at more distant locations.

2
von Thunens model (8.14)

• intensity of land use, higher priced/more
  perishable goods are produced in land closer to
  the city. High shipping and high demand
  commodities found in inner rings.
• A portion of each crop is eaten by the wheels -
  observed by von Thunen, distance between market
  and production site is the most important
  determination of the location
• Transport gradients (8.15) - crops with highest
  transport cost and market values will be grown
  nearest to the market.

• Transportation cost affect the shape of Rings
  (8.16)
• Industrial and post-industrial economy, land use
  is determined by factors with urban expansion.
  von Thunen model is less predictable

3
Intensive Commercial Agriculture

• Characterized by high yields per unit of
  cultivated land
• Large amount of input - justified by fruits,
  vegetable and dairy products. Truck Farm produces
  wide range of vegetable and fruits with
  refrigerated trucks and custom packaging.
  (distribution of truck farm 8.17)
• Livestock-grain farming - growing grain for
  livestock feed. corn and livestock at same farm
  reducing transportation cost. Close to the great
  coastal and industrial zone markets.
• livestock price higher than feed, farmer convert
  their corn into meat on the farm by feeding it to
  the livestock

4
Extensive Commercial Agriculture

• Farmland values decline westward with increasing
  distance from the northeastern market of the US,
  but not increasing while near west coast.
  Climate and environmental considerations
  (increasing aridity and mountain ranges..) (8.18)
• Large-scale wheat farming - requires large amount
  capital input. Spring wheat (Dakotas, e Montana,
  S Canada) winter wheat (Kansas..) Argentina in S
  hemisphere. Wheat is the most grain production in
  the world (8.20)
• Livestock ranching - oriented to the urban market
  of industrialized countries. Confined to areas of
  European settlement., Caused destruction of
  tropical rain forests in Central America and the
  Amazon basin due to expanded cattle ranching. (in
  land with low quality, low pop density, and
  require low labor)

5
Special Crops - mostly due to climate factor

• Mediterranean agriculture - grapes, olives,
  oranges, figs, vegetables and similar commodities
  - needs warm temp. all year round plus summer
  sunshine. Summer drought and winter rain,
  irrigation system is needed.
• Plantation crops - foreign to the areas (8.22)
• tea in India and Sri Lanka, jute in India and
  Bangladesh, rubber in Malaysia and Indonesia,
  cacao in Ghana and Nigeria, can sugar in
  Cuba...., coffee in Brazil and Colombia, banana
  in central America.
• Most plantation in coastal area, easy for export.

6
Planned Economy

• agricultural communes in Soviet Union, Eastern
  Europe, and mainland China. Program set up by
  Stalin.
• In China, communist regime redistributed all
  farmlands to some 350 million and collectivized
  into 700,000 communes in 1957 and reduced to
  50,000 with 13,000 members each.
• Free market in China (8.24)
• loss of farm land to urbanization, is not
  compensated by yield increases would again raise
  the prospect of shortage of domestically produced
  food.

7
Primary Activities Resource Exploitation

• Gathering industries - fishing and forestry
• Extractive industries - mining and quarrying
• Renewable resources - materials can be consumed
  and then replenished quickly by natural or by
  human-assisted processes. such as forest, fish,
  grasslands, and animals. Maximum sustainable
  yield - max. rate of use that will not impair its
  ability to be renewed or to maintain the same
  future productivity. If exceeded, renewable will
  become nonrenewable.
• Nonrenewable resources - exist in finite amount
  and either are not replaced by natural processes.

8
Fishing - provide 19 of all animal protein in
the human diet (5 in all protein)

• steady fish harvest increase (8.26) except in
  1998 (El Nino)
• 99 fish are from coastal wetlands, estuaries,and
  continental shelf. 1 from open sea. Commercial
  capture fishing for market only in northern
  hemisphere, tropical fish do school and contain
  higher oil content, only for local use.
• Overfishing - due to the accepted view of open
  seas
• tragedy of the commons - a open resource without
  collective controls being exploited to the max.
• Aquaculture - farm ponds, catfish and crayfish
  ponds in SE US
• Mariculture - coastal lagoon
• 30 of worlds fish harvest from aquaculture and
  mariculture production.

9
Forest - Covers 30 of the earth land.

• 1) Northern coniferous (softwood) - largest- for
  construction, paper..(8.29) 2)Deciduous
  hardwoods (oak, maple, hickory) reduced by
  urbanization and agriculture - for furniture..
• 3) Lowland hardwood for fuelwood and charcoal and
  special wood exported for lumber. Malaysia
  accounted for 60 of the world hardwood logs
  export.
• Roundwood production -
• 45 for industrial consumption and 55 for
  fuelwood and charcoal. Developing countries rely
  on fuelwood and charcoal resulting in the serious
  depletion of tropical forest stands. In tropical
  areas, deforestation rates exceeds reforestation
  by 10 to 15 times.
• since 1970s, 25 to 30 million acres of tropical
  forestland have been converted to agricultural
  land and in S and Central America additional
  millions of acres been cleared for beef cattle
  for the N Ame. market.
• Half of roundwood production (for industrial
  markets) are from US,Canada and Russia and less
  than 20 from developing countries due to the
  transportation cost, explained by von Thunens
  model.

10
Mining and Quarrying - Definition of reserves
(8.31)

• Extract industry depend on the exploitation of
  minerals unevenly distributed in amounts and
  concentrations determined by past geologic
  events, not by market demand.
• In 1980s, many iron ore-producing plants were
  shut down due to the cheap import.
• Metallic minerals - production influenced by
  quantity of ore available, richness of ore, and
  distance to market.
• After h-quality ore is exploited, the demand for
  low-grade ores has been increasing. upgrading
  process done near site (concentration of copper,
  smelting facilities 8.32) and refinery at the
  market areas.
• And, large deposits of low-grade ore is being
  exploited instead of h-q ores due to the cost and
  consideration of long-term source of supply.
• Most important extractive industries -
  nonmetallic Minerals (in terms of volume and
  weight), mostly used for construction, only
  economically feasible when they are near the site
  where they are to be used. (8.33)

11
Mineral Fuels

• Energy consumption vs. GNP (8.34)
• Coal classified by rank (carbon content and fuel
  quality) and grade (measure of its waste material
  content), mined by strip-mining and shaft mining
  (Appalachian and Europe). Coal will last many
  centuries but not for oil.
• Petroleum reserves can only last 40 to 150 years.
  Petroleum is the most unevenly distributed
  resources.
• OPEC (Organization of Petroleum Exporting
  Countries)
• See Chapter8-Petroleum.ppt
• Natural Gas - highly efficient and requires
  little processing

12
The End of Cheap Oil

• Oil reserve - 1020 gbo (gigga-barrels of oil) 25
  gbo/yr consumption, but with 2 increase of
  consumption, it wont last 40 yrs.
• New discoveries - 7 gbo/yr
• US gasoline price - http//www.ouraaa.com/news/new
  s/fuel.html
• Americans consumed 19 million barrels/day2.9
  g/p/d1000 g/person/yr, production2.6 bbls in
  2000. Reserves can only last 5 years if without
  import.
• Gulf of Mexico holds 15 bb of oil, high cost
  required to exploit.

13
Oil discoveries and Production
1960
2000
Production
Discoveries
1860
2100
data source Scientific American, March 1998
14
Evolution of gasoline price
15
DataUS DOE