Agriculture Reference
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of 900 soybean acres experience production costs 82 percent
(per bushel) lower than 300-acre farms. Large corn farms pro-
duce at a 38 percent lower cost (per bushel) than small corn
farms. Likewise, dairies with more than 2,000 head of cattle
produce at a lower cost (per gallon of milk) than dairies with
30 cows or less. Large hog-slaughtering facilities can process
hogs at a cost 11 percent lower (per lb.) than small facilities.
A large brewery has half the costs (per ounce) of a small one.
Also, large corporations can afford the research and devel-
opment costs necessary to invent and market scientific tech-
nologies like pesticides, chemical fertilizers, and genetically
modified crops. It is largely because of economies of scale and
new technologies that world food prices have steadily fallen in
the last hundred years, even while the world population has
risen and the number of farmers has fallen.
Food activists do not contest the numbers in figure 1.2, but
they insist that the quality of food has also fallen, and that
200
10
180
9
Composite Agricultural
Price Index (1977-79=100)
160
8
140
7
120
6
100
5
80
4
60
3
40
2
World Population
(billions)
20
1
0
1900
0
1910
1920
1930
1940
1950
1960
1970
1980
1990
2000
2010
Figure 1.2 Agricultural Product Prices and Population Growth Since 1900
Source
: Keith Fuglie and Sun Ling Wang, “New Evidence Points to Robust but Uneven
Productivity Growth in Global Agriculture,”
Amber Waves
, September 20, 2012. Economic
Research Service, US Department of Agriculture. Data for chart provided by Keith Fuglie on
August 15, 2013.
