U.S. may have edge as world seeks tailor-made foods

WASHINGTON (Reuters) -- U.S. farmers hold an electronic edge over competitors when it comes to supplying the higher-profit, grown-to-order grain and meat demanded by increasingly finicky foodmakers, an industry executive said this week.

Greg Page, chief operating officer of Cargill Inc., one of the world's largest food processors, said widespread use of computerized records paves the way for U.S. farmers to benefit from rising demand for grain with specialized characteristics or high-quality meat specified by restaurateurs.

"A new global food system is emerging," Page told a conference sponsored by Farm Journal magazine. "I would rate the United States as being at an advantage."

Other speakers at the forum also envisioned a more tightly linked food chain than in the past. Consumers and foodmakers, they said, will have a larger voice in detailing the methods used in farm production and requiring grain or meat to carry particular attributes, such as animals that yield juicy, tender meat or wheat with ideal baking traits.

"We start with a base of electronically enabled farmers, superior to any in the world," Page said in foreseeing a growing volume of sales of such specialty items. "If you look at our big export competitors...I think we are uniquely positioned to benefit from this."

As an example, Page cited an ear tag for feeder cattle that can be scanned electronically to track an animal from birth through slaughter.

Traditionally, American farmers are individualists wary of group undertakings or dominance by giant meatpackers and grain processors. And while some economists see the chance for farmers to profit by becoming part of an alliance to produce food to order at premium prices, farm activists believe the webs may reduce growers to serfs who plant, cultivate and harvest at the order of a far-off corporation.

Some new-style cooperatives have arisen with the goal of giving farmers a share of the revenue that accrues to processors. Management expert David Geiman applauded one such cooperative, U.S. Premium Beef, as "a phenomenal success" that "needs to be duplicated."

Robert Honse, chief executive of farmer-owned Farmland Industries, a leading grain and meat processor, said the food industry of the future will want more documentation on how grain or meat was produced as well as assurances of quality.

He cited examples involving Farmland of pork produced under methods specified by the buyer, so called identity-preserved grain that is tracked through every stage of processing and distribution, and beef grown under contracts that promise high-grade meat.

While electronic wizardry may benefit farmers, they are still expected to feel price pressures in coming years, but speakers at the two-day forum said they will not be alone.

Richard Christman, president for agricultural business at Case IH, a large U.S. equipment manufacturer, said there also would be a thinning of the 6,000 farm equipment dealers in Canada and the United States.

About 180,000 farmers in the two nations account for 70 percent of farm income, Christman said, a figure that equates to 30 commercial-size farmers per dealer.

"That is not enough to have the kind of dealership that farm customers want and deserve," he said.

Christman, who said his firm was not trying to get rid of dealers, declined to forecast how sharply their ranks would be culled.

Copyright 2000 Reuters. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

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