Lessons Learned for the Future Ed Kee Secretary of Agriculture State of Delaware Lessons Learned for the Future “Those who cannot learn from the past are condemned to repeat it.” George Santayana, 1906 This is not a sentimental journey, but rather a business or industry case study Agricultural Eras in Maryland The Tobacco Coast Breadbasket of the Revolution By 1900 – Southern Maryland: Tobacco Central Maryland: Dairying Eastern Shore: Vegetables Western Maryland: Dairying and Fruit Emergence of a Diversified Ag Economy Grain, Dairy, Tobacco, Fruit and Vegetables Emergence of a Market Driven Agriculture Emergence of Technology 1st Manufactured Fertilizer, 1849 in Baltimore Science and Technology • Maryland State College of Agriculture, 1856 • USDA Emergence of the Food Preservation Industry Canned Products Emergence of the Poultry Industry Broiler Industry – 1923, Ocean View, Delaware A Delmarva Industry An amazing Industry $903 million industry Coupled with corn & soybeans = 75% of Maryland’s ag sales The Canning Industry: A Founding Pillar of America’s Food Industry A Case Study for Maryland Baltimore Maryland Delaware Focus on the Rise and Fall of an Industry The Canned & Frozen Vegetable Industry Why it Grew? How Big Was It? Why did it Decline? It’s an Important Story Economic History, and much more – Capital, Land, & Labor Immigration & Assimilation Race and Ethnic Groups Industrialization of Agriculture Feeding the World 1842 – 1st Canning in Baltimore – Oysters in Winter Soon year round canning with Vegetables and Fruits in Season Canning was a new, revolutionary technology Oyster Buyer & Skipper on a Baltimore Dock - 1886 Why Baltimore? 1830 – 2nd Largest City in US – 80,000 people Chesapeake Farms Nearby Railroad – B&O and the Baltimore, Wilmington & Philadelphia Civil War – great impetus Labor - Immigration Today’s Discussion: Focus on Parallels to Today’s Agricultural Economy Industry created jobs 1884: 56,000 jobs in Maryland Enterprise Opportunity for Farmers Why the industry grew and spread Why it declined What public policy could have been implemented to keep it as a local industry Hindsight is 20/20 Canneries in 1889 Location Number % of U.S. United States 1,042 100 Maryland 387 37 Baltimore 110 11 Delaware 49 5 New Jersey 74 7 Virginia 120 12 Baltimore City 1876 – 14 Picklers & Preservers 1889 – 110 Canners & Packers 1919 – 45 Canners 1927 – 38 Canners Why did the industry grow? Civil War stimulated demand Railroads connected canners with consumers (later highways) Exploding urban populations The region’s soil and climate conditions excellent for many crops The region was the Silicon Valley of the Food Industry from 1830s to 1950s Baltimore Canners - 1894 Perhaps the Biggest Reason: Entrepreneurs J.S. Ferran Packing Company – Baltimore – Cutting String Beans - 1910 1919 – 3228 Processors in U.S. State # Companies % of U.S. Delaware 71 2 Maryland 450 14 New Jersey 55 1.7 Virginia 584 18 TOTALS 1160 36% Canneries in 1919 Delaware, Maryland, New Jersey 585 Canneries 536 did tomatoes and/or ketchup 93 % 289 did tomatoes and/or ketchup exclusively 49% Cutting Corn for Canning in Baltimore – 1930s Phillips Packing Company – Cambridge, Maryland “World’s Largest Tomato Packer” Maryland Vegetable Processors Year # Firms # Plants # Tomato # Tomato % Firms % Plants Firms Plants Tomatoes Tomatoes 1927 392 430 328 363 84 84 1938 184 308 186 224 100 73 1959 123 144 77 86 63 60 1980 40 40 20 20 50 50 Today 3 3 0 0 -- -- What Happened Since 1945? Chronic Overproduction Affect price Especially critical to small Companies Competition from Grain crops Government safety net 1970s grain boom Delmarva Poultry Industry Labor Availability and Costs Farm and Factory Level What Happened Since 1945? “We can grow good crops in this area, but there is always some other region that can grow a particular crop a little better than we can. Tomatoes in California, peas in Wisconsin, sweet corn in the Pacific Northwest and so on.” Dr. Pete Twigg, University of Maryland California – 30 tons/acre in 1975; Delmarva – 20 tons/acre Speaks to Ag Research and Technology What Happened Since1945? Competition from other regions California Our tax dollars paid for their irrigation Interstate Highway system gave the west access to eastern markets New Industry out there, more efficient operations Ultimate Example California Processed Tomato Industry – 95% of Processed Tomatoes in the US! Maryland was the leader until 1924! Maryland, Delaware and NJ leader until1954 California – based on science and technology – plant genetics, plant physiology, and harvester engineering Coupled with perfect Climate What Happened since 1945? 2000 issue was resolved Local, family owned processors felt threatened, overwhelmed by new environmental regulations that emerged in the 1960s What Happened Since 1945? Regulations- Environmental Regulations- “All of a sudden, what had been the lifeblood of the community became an eyesore.” Sylvia Jarboe Gannon, Easton/St. Michaels Harrison- • Harrison-Jarboe Canning Company Other Issues Hesitancy to invest capital for production upgrades and waste water facilities Generational Transfer – Often the next generation had had enough What Could Have Been Done? advantage? Did we squander our competitive advantage? Ag Research & Technology Public financed promotions Emphasize Maryland or our region in large markets Irony in buy local movement of today Public investment in upgrades New Technologies Waste Water/Pollution Mitigating Technologies Population within 8 hours drive MD, VA, PA, DE, NJ, NY, NC, OH, WV, DC 75 Million People, or 25% of US 8,000,000 in NYC How Do We Reach Them???? Processing Acreage - 2003 Delaware 41,700 Maryland 13,900 New Jersey 10,900 Pennsylvania 10,550 Virginia 1,970 What Does a Viable Farming and Ag Industry Do! Diversity – Farm Income Preserves Land – Environmental Quality Processing Adds Value – Partnership allows many farmers to reach markets Jobs, Economic Development 5-7 multiplier effect Stronger Ag Economy – Proves Agriculture is a viable enterprise Connect Farmers and Consumer on all levels Fundamentals A prosperous Maryland (or Delaware) agriculture must rely on exports To our population centers To the world Connection of farm to food processing, or ag- Perhaps Energy or some other ag-based output Land Farmers Expectation of Making a good living Capital Labor Transportation costs that are manageable Need farmers, Land, Technology, economically viable plans in the private sector; good public policy to support agriculture; and a common resolve that agriculture is important! Will We Squander This? Will We Lose Our Competitive Advantage? Thank You!! A Founding Pillar of the Greatest Food Industry in the World has moved elsewhere. WHAT IS THE NEXT NEW AG INDUSTRY MAINTAIN & ENHANCE OUR EXISTING INDUSTRIES Public Policy that gets it and enhances the private sector Hot, Flat & Crowded by Thomas Friedman We don’t want the sequel to be about agriculture!!
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