Consumers are definitely paying more attention to the food they eat and that’s having ramifications throughout the entire ag industry, said Daniel Smith, agricultural development administrator for the Wisconsin Department of Agriculture, Trade and Consumer Protection.
“Everyone is involved in the food system. As long as you eat, you’re involved in the ag industry,” said Smith, who spoke last week at a business innovation event focused the ag industry in Appleton, Wis.
He said consumers, however, have a lot of misconceptions about farming. “It’s not your grandpa’s farm anymore,” Smith said. “There’s robots and technology all over the place. Our farms are embracing new technologies involving planting and livestock practices.”
“There’s misconceptions about corporations owning farms, but it’s still family based,” Smith said. “There may be two or three families or family members owning a single, large farm together.”
Smith praised how quickly farmers are adapting to new technologies. “We have fewer people producing more food,” he said.
When looking at the future of the ag industry, Smith pointed to several main topics that will govern discussion:
- The role technology plays in animal husbandry
- Transitioning into more business-like structures
- Growing interest in investing in farms
- Increased specialization
Smith said as the average age of farmers increases, there will be more discussions on how to transition the farm from one generation to the next.
“You have to look at cash flows, the business plan and assets,” he said. “Sometimes, it can be hard to bring in that next generation if you need to recapitalize the farm while at the same time you’re looking for retirement income. We work with farmers to help them get ready for when they meet with attorneys to talk about these issues.”
Investors are becoming more interested in agriculture since they realize the important role it plays in the economy, Smith said. He explained that a group of California investors behind the San Francisco 49ers new stadium recently bought a Wisconsin-based company with $32 million in sales because they “want a seat at the table when it comes to food production and they realize how hot the industry is.”
Wisconsin is America’s cheese capital, Smith said, and that’s one sector where specialization plays a big role. “We have many people here who are very good at what they do and they are having an impact on the larger stage,” he said. “Specialty ag products will continue to be winners for those farmers involved.”
To get to the next stage of the ag industry, Smith said there are three issues that worry farmers – labor, land and leveraging.
“It’s a changing workforce and farmers can’t rely on the kids down the road to help out,” he said. “I’ve had farmers tell me, ‘I used all the neighbor kids and they did whatever I wanted as long as they got off for football practice, but that’s gone and now I have to hire help that’s 30 or 40 minutes away.’ Farmers are finding it a bigger challenge to find reliable workers.”
Smith said farmers are also concerned about protecting their resources – water and soil – and look for practices that do just that.
“And with leverage, farmers are worried about finding funding for their next stage of investment,” he said. “It’s a constant struggle.”