Transcript The Economic Importance of North Carolina Animal Agriculture

The Economic Importance of
North Carolina Animal Agriculture
Blake Brown and Kelly Zering
Department of Agricultural and Resource Economics
North Carolina State University
Animal Agriculture is a major component of
North Carolina Agriculture…and the NC
economy
Agriculture and Food
is an Important Part of the Economy of
North Carolina
“Almost 17% or $71.6 billion of the $425 billion gross
state product is contributed by food, fiber, and
forestry industries”
“… 638,000 of the state’s 3.8 million employees”
Source: Prof. M. Walden, NCSU
… and Animal Ag is a Big Part of NC Ag
2010 NC Cash Receipts from Farming
Veg,. Fruit, nut, 5.4%
Nursery, Greenhouse,
Christmas Trees,.. 7.9%
Cotton 3.6%
Broilers 27%
Soybeans 5.3%
Corn 3.7%
Tobacco 6.1%
Dairy 1.7%
Pigs 23.2%
Livestock,
Poultry and
Dairy
2/3 of all NC
Farm
Receipts
Cattle 2.6%
Eggs 3.4% Turkeys 6.1%
Source: NC Ag Statistics Yearbook 2011
Most NC Farms include Livestock and/or Poultry
NC had 52,913 farms in 2007
Non-family
farms, 1,857
Sales less than
$250,000
Small Family
Farms, 45,191
Source: USDA-NASS
Very large
family farms, Large family
4,114
farms, 1,751
Animal Ag Across North Carolina
(numbers of livestock)
Broilers
Cattle
Turkeys
Pigs
Source: NCDA Ag Stats 2011
Modern Broiler, Pig, Turkey and Egg Farms Represent
Significant Capital Investment and Property Tax Base
Average NC farm: 164 acres @ $4470 = $733,080,
Broiler or turkey enterprise $400,000 to $900,000 and higher
Hog enterprise $175,000 to $3.2 million
Across NC, more than $1.5 billion in pig buildings,
$2.5 Billion in broiler, turkey and layer buildings, …
Animal Agriculture supports other
industries…and communities
Farm Production Supports Large Feed Mills and
Poultry and Pork Processing Plants in North Carolina
Estimated capacity and investment in feed mills,
hatcheries, and processing plants: $ 4.6 Billion
Animal Ag Creates Large Local Markets for
North Carolina Crops
Corn and soybean meal and sometimes wheat are the main
ingredients in animal feed. Feed makes up around 70% of the farm
cost of animal ag.
A rough estimate is that Animal Ag in NC consumes 285 million
bushels of corn/wheat and 3.3 million tons of soybean meal each year.
These amounts are about 3X typical NC production
A major initiative is underway to increase NC grain production to
enhance farmer income and reduce reliance on imports
Jobs, Jobs, Jobs, …Income, Income,
Income, …. Tax Base
The pork sector in NC generates 19,700 direct jobs plus 27,400 indirect
jobs. It generates $2.34 billion in value added income (Zering 2010).
The poultry sector in NC generates 22,713 direct jobs plus 58,502
indirect jobs. It generates $7 billion in wholesale product sales and
$18 billion in economic activity (private study for USDA/R. Ford)
Animal Ag Includes Many Local Entrepreneurs
Serving All Kinds of Markets
Animal Ag Stimulates Trade
Exports of NC Agricultural Products ($million)
“Current UN projections indicate that
world population could increase by 2.25
billion people from today’s levels,
reaching 9.15 billion by 2050. At the
global level, agricultural production
and consumption in 2050 are projected
to be 60 percent higher than in
2005/07.”
Animal Agricultural will play a major
role in the growing global demand
for food
Implications of 30% Growth in Global
Population and 150% Growth in Global GDP
Meat Quantity Demanded increases by 100% by
2050 (e.g. FAO 2006 Livestock’s Long Shadow)
Feed Grain Quantity Demanded increases by 1 billion
tonnes per year by 2030 (2.7 times US corn production)
(e.g. FAO 2006 Livestock’s Long Shadow)
The U.S. is a Major Producer of
Meat and Eggs
2011 U.S. Share of Global Production
(USDA FAS 2012 and FAO 2011)
Broiler Meat
Eggs
Pigs
Turkeys
20.7%
8.7%
10.1%
48.8%
U.S. has 12.3% of global crop land area and less
than 5% of global population (e.g. FAOSTAT 2011)
North Carolina is a Major Producer of
Meat and Eggs
2010 NC Share of US Production (NASS /NCDA Ag Statistics)
Broilers (Mill.Head)
Eggs (Value of Prod)
Pigs (Inventory)
Turkeys
8.9%
5.0%
13.9%
12.3%
NC has 0.9% of U.S. agricultural land area, 2.38% of U.S.
farms, 3.1% of U.S. farm receipts and 3.06% of US
population (e.g. NASS /NCDA Ag Statistics and US Census Feb 2011)
Technology Plays a Key Role in Global Agriculture
.More discovery and innovation
is needed to meet
the global challenge
Current Issue: Drought, Livestock Margins,
Food Prices, Ethanol
Severe drought has reduced US corn production by 25% since planting
with estimates at 10.8 billion bushels nationally. 4.5 billion bushels are
projected to be used for ethanol production (WAOB USDA Aug 2012)
High feed prices are forcing animal agriculture producers to reduce
production (layoffs, bankruptcies) which in turn is increasing food
prices: USDA predicts 8% higher meat prices in 2013.
Animal Agriculture in North Carolina:
• is a major component of NC agriculture and a
major contributor to our economy
Animal Agriculture in North Carolina:
• is a major component of NC agriculture and a
major contributor to our economy
• supports many industries and jobs…from
feed supply to processing final product
Animal Agriculture in North Carolina:
• is a major component of NC agriculture and a
major contributor to our economy
• supports many industries and jobs…from feed
supply to processing final product
• has a global presence and can have a
significant role in feeding a growing world
Current global trends and food challenges provide
great opportunity for North Carolina
How can we ensure that North Carolina Animal
Agriculture continues to be a sustainable
platform for economic growth and jobs in our
communities?