MarkWhat kind of attitude to agricultural risk would you have if you worked over 50 hours a week to grow food for sale at a price set by the market and had no way of protecting your produce from the weather or fickle consumers?
Yep, you would be conservative even with the balls of steel necessary to take on the challenge.
There are a little over 2 million farms in the US run by farmers who must face the risk of food production every day.
As in the rest of the world, most US farms are small, with an average farm size of 444 acres (180 ha) with around 37% of them operated by full owners, essentially family-run businesses.
In a survey of farmers just prior to the 2020 presidential election, the vast majority of the 5,000 surveyed said they would be planning to vote for Donald Trump to be reelected to a second term. Just 12% said they planned to vote for the Democrat Joe Biden.
In office, Trump created enormous volatility in farm prices and uncertainty in most commodity sectors. He did open the door for more exports but international trade tariffs have cost farmers dearly for that privilege.
Most importantly, though, President Trump was consistent in reducing environmental regulation.
That is a big deal for farmers whose attitude to agricultural risk often felt that green tape reduces their already limited options. Joe Biden, on the other hand, has talked of increasing those regulations partly in response to his plans to combat climate change.
We could also add that farmers in the US tend to be white, old and rural. This means that the tendency to be Republican in the broadest sense is also prevalent among this voting group.
Agricultural policy is not the only thing on a rural voter’s mind, but the impression of conservatism is hard to shake when the proportions are this high.
Farmer conservative attitude to agricultural risk
Farmers all around the world are caricatured as conservative. Their attitude to agricultural risk reflects following the local norms of production practices. If it was good enough for Pops, then it’s good enough for me and my neighbour too.
But it is wrong to assume that this means that they are all slow to change and stuck in their ways, even if many might be. The conservatism they follow is more about their need to be unencumbered as they take on the huge challenge of growing food and fibre.
This attitude to agricultural risk translates to political views that favour free enterprise, private ownership, and socially traditional ideas.
Risk stares at every farmer when he leaves his farmstead to tend to his field or livestock. Days begin and end with decisions that are weighed up against risk. All the time they are faced with choices that impact their costs, profits, welfare and even their future livelihood.
Sources of agricultural risks include
- price or market risk (output and input price fluctuation, market shocks),
- financial risk (loans and credits),
- production risk (weather-related risk, impacts of pests and diseases, technology change, yield uncertainty)
- institutional risk (regulations, legal, environment and tax policy), and
- human resource risk (physical and mental health)
Market risk is more frequently mentioned than weather and climate in research on farmer attitudes to risk, but the last thing a farmer wants is to be encumbered by red tape or green tape or being told what they can and can’t do by some bean counter with clean fingernails.
Photo by Jonas from Berlin on Unsplash
What happens when the risk profile changes
The reality is that all farmers have to deal with risk one way or another. Interestingly though, the source of risk is less important than attitude to risk regarding how they cope.
…perceived major risk sources have no significant effect on the propensity to implement any risk strategy… risk management is not so much guided by the amount of risk faced, but rather by the attitude towards risk
van Winsen, F., de Mey, Y., Lauwers, L., Van Passel, S., Vancauteren, M., & Wauters, E. (2016). Determinants of risk behaviour: effects of perceived risks and risk attitude on farmer’s adoption of risk management strategies. Journal of Risk Research, 19(1), 56-78.
If attitude to agricultural risk is more important than the risk profile, many farmers will become exposed should the risk profile change. And for many, this has happened politically under Trump, but it is also due to global market shifts, rising input costs, resource depletion, especially in soils and issues with climate change.
As much as they are considered conservative, farmers are also individualists with a frontier capability and no need for any assistance from anyone. It’s tough, but I can get by if you just get out of my way.
This conservatism can undermine risk mitigation when the intensity or source of risk shifts.
Freedom to operate can be the opposite of what happens because an agricultural policy is also designed to mitigate collective risk. Hence, we see direct subsidies through price controls or indirect subsidies through drought or flood relief payments and controls to protect other environmental values.
Farmers probably supported Trump for several reasons, but some would have liked the promise of greater freedoms to operate.
What sustainably FED suggests
Sustainably FED is about how to be innovative in feeding everyone well, and how to change the way things are done so that production can be more efficient and effective to deliver sustainable food through a sustainable diet.
Food ecology is critical to these outcomes.
Integrating production into ecological processes is a big shift for many farmers, especially when their attitude to agricultural risk is shaped by a market problem that politicians can help resolve or their innate conservatism encourages them to want to go it alone.
Only the risk profile is changing, and so will the attitude to agricultural risk.
There is a greater acute risk, and more strategic risk and much of the time, it comes from novel sources. A fixed, personal attitude to risk mitigation might not be practical when the goalposts move.
Not being flexible can be a crunch point in solving the issues that sustainably FED talks about in the global 22 trillion a day challenge.
As it so often does, this brings solutions for sustainability and their success all down to people.
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Science sources on farmer attitude to agricultural risk
Chavas, J. P., Cooper, J., & Wallander, S. (2019). The impact of input and output decisions on agricultural production risk. Journal of Agricultural and Resource Economics, 44(3), 513-535
Duong, T. T., Brewer, T., Luck, J., & Zander, K. (2019). A global review of farmers’ perceptions of agricultural risks and risk management strategies. Agriculture, 9(1), 10.
van Winsen, F., de Mey, Y., Lauwers, L., Van Passel, S., Vancauteren, M., & Wauters, E. (2016). Determinants of risk behaviour: effects of perceived risks and risk attitude on farmer’s adoption of risk management strategies. Journal of Risk Research, 19(1), 56-78.
Hero image modified from photo by Dietmar Reichle on Unsplash
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