[maxerickson]

The impact on the final price of the produce matters more than the comparison to pesticides.

Like if pesticides represent 0.1 percent of the retail price of some vegetable, I personally would consider it reasonable to spend 10x avoiding some pesticides. Because it would only have a modest impact at retail.

[mikekchar]

The price of wheat in the US is currently ~$170 per tonne. Retail price of flour in the US is currently a bit over $1100 per tonne. Fertiliser and pesticide cost seems to be about 23% percent of revenue, which would work out to about $40. So fertiliser and pesticide cost is currently about 3.6% of the final retail price. Figures come from random google searches, but I think they are about right.

There are a few things you have to understand about these figures. The first is that only 15% of the retail price is the price of wheat. The rest is shipping, processing, packaging, waste, advertising, and profit. You can actually work out how much each bit actually adds to the price by looking at the price at each step. For example, if you look at wholesale wheat flour prices, you are looking at about $3-400 per tonne.

The reality is that distribution is the vast majority of the cost and each entity that touches the product along the way wants a big markup. Money costs and each party wants a return on investment, not a fixed return.

So, if we replaced fertiliser and pesticide with something that costs $400 instead of $40 per tonne of wheat, then the price of the wheat will go to $530. Ideally that will result in a retail price of ~$1500 (about a 25% increase), but in reality it's likely to be at least double.

Personally, I think this is worthwhile -- especially if the extra $360 per tonne would allow smaller farms and provide more jobs in the farming industry. I don't think it is realistic for 2 main reasons. First I have no idea if even $360 would be enough. Second, large corporations and rich people have a very vested interest in continuing the current trend of moving all of the price into distribution. These distribution channels can be controlled relatively easily and provide rent for them. It also keeps the world food price below the level that traditional farming can support. This means that rich countries can dismantle the agriculture industry of poor countries and then control them. I encourage anybody interested in this kind of thing to look at the conditions attached to government loans/subsidies to poor countries that are used to buy food. When you start looking at this stuff, you are playing with big players who have lots to gain/lose and who aren't going to give up anything easily.

[randomdata]

> especially if the extra $360 per tonne would allow smaller farms

I would expect the opposite. Wheat was worth a record-high ~$380/tonne back in 2008 and what happened was that the biggest farmers went spend-crazy on land, preventing the existing small farms from growing, and completely pushing thoughts of any new farm operations right out the window. We're still suffering the effects of that as price of land has yet to come down with the price of the crop.

> and provide more jobs in the farming industry.

I'm not sure that lack of jobs are really an issue in the farming industry, to be honest. There is already said to be a farm labour shortage as-is. I farm in Canada, so those are the numbers I'm most familiar with, but the news reports that there are 60,000 vacant farm jobs available. Other reports indicate that farm jobs have one of the fastest growing wages in the country (which I realize technically invalidates there being a shortage, but labour shortage has come to mean something other than shortage).

A big reason why agriculture has been pushing the boundaries of automation is a result of how hard it is to find labour. Especially skilled labour.

[mikekchar]

I have to admit that even though I posted what I did, I don't really understand the dynamics of the situation. I know the result I would prefer, but I have no idea how to get there. I'm originally from Canada and my family benefited greatly from the boom cycles of farm land prices. Now I'm living in Japan where it is illegal to sell farm land. I find the different dynamics extremely interesting, but as I am not a farmer, I really don't understand. I honestly believe we're going to be in some difficulty unless we can reboot the small farm, but it seems to be extremely complicated. Even here with high prices, high subsidies, and small farms, there are very few young farmers. Of my neighbours, I think there is one guy who is about 40 and everybody else is well over 60. I have no idea what's going to happen in 10-20 years and it worries me a lot.

Anyway, as you seem to be a farmer, please let me convey my utmost respect. Seriously, thank you for being a farmer. We need more people like you.

[randomdata]

> there are very few young farmers. Of my neighbours, I think there is one guy who is about 40 and everybody else is well over 60.

That is interesting, because the exact opposite is true of my neighbours. Growing up, there were eight farm families clustered fairly close together. In all but one of those cases, the next generation (all still under 40) have become heavily involved with, if not completely taken over, their family's farm. And in that remaining case, the grandson is starting to take the same role.

The age statistics can be a little misleading as farms are multi-generational businesses, but they usually only count the primary farm operator for statistical purposes. Which, for legacy reasons, tends to be the oldest person still involved. In many cases there will be someone waiting in the wings to take that spot when retirement comes.

> I have no idea what's going to happen in 10-20 years and it worries me a lot.

I am less so. If there truly is a lack of young farmers, 2008 will happen again. Meaning that the food price will rise, and people will get all excited about the fortunes to be made. 2008 has already changed attitudes about farming. It was fascinating to watch people go from "why would you ever want to do that?" to "how can I become a farmer too?" over the span of those months. Farming suddenly became 'cool' as soon as there was money to be made. There has been far more interest from young farmers since that time, from what I can observe.

But people want to be farmers (i.e. the owner), not farmhands. Being a farmhand is still looked down upon, leading to lack of interest from labour. Interestingly, that could maybe even result in smaller farms down the road if automation doesn't solve the problem first.

[maxerickson]

Of course people don't enthuse over seasonal work that pays $15 an hour.

Why would they?

(I get $15 from brief research; but even at $20 or $25, seasonal work with no benefits isn't a great job)

[randomdata]

That seems rather low to what I've been seeing out there (granted, fast growing wages make it a big moving target). But I agree with your general sentiment.

Coupled with the fact that the most productive farming regions in Canada have the lowest unemployment rates in the country, there is no reason why anyone has to settle for a farm job. They can get a job almost anywhere. Employers in these agriculture communities are desperate across the board for labour, not just those involved in agriculture.

Anyway, the economy is fundamentally self-correcting. I don't see there being anything to worry about. I'm biased as a small farmer, but I don't see slowing down the big producers as a bad thing.

[dmurray]

> Other reports indicate that farm jobs have one of the fastest growing wages in the country (which I realize technically invalidates there being a shortage, but labour shortage has come to mean something other than shortage).

Isn't that the exact definition of shortage? Prices rise because demand excess supply at the previous price.

[randomdata]

A shortage is technically defined as a situation where price cannot rise, such as the government imposing a price ceiling, preventing the price from reaching equilibrium. As long as price is able to rise, demand will wane with the rising price, and thus the supply will ultimately meet the needs of the demand.

That price is rising should invalidate the idea of a shortage, but labour shortage seems to have come to mean a situation where an employer has made their desire to hire known, but received no suitable applicants.

[shkkmo]

Isn't a shortage technically defined as when supply can't meet demand? Capped prices is one potential cause, but demand also isn't always very elastic and this can cause shortages on it's own.

[randomdata]

> Isn't a shortage technically defined as when supply can't meet demand?

It is, yes, and ultimately says the same thing. I prefer the alternative phrasing as I think it more clearly explains the mechanisms, especially when people sometimes confuse demand to mean 'I want something'.

> Capped prices is one potential cause, but demand also isn't always very elastic and this can cause shortages on it's own.

I don't see it being contradictory. In an ideal model of inelastic demand, the demand never wanes no matter how high the price goes. However, price cannot continue to rise infinitely, so you have technically created a situation where price cannot rise again. It is still the price not being able to rise that characterizes the shortage in this case.

I did not mean to suggest that the government is the only thing that can cause prices to stop increasing. It was just one example.

[_0w8t]

There was a study in Denmark that showed 25% of the income from sales in supermarkets went into advertising.

It is interesting that the distribution, not production, dominated the prices since ancient times. 2500 yeas ago in Mediterranean transporting wheat 100 km over land doubled its price compared with price at a sea port which was already quite higher than production. In a bad year when local crop failed rich citizens prevented widespread hunger by buying enough extra bread overseas.