The State of Agriculture
Perspectives On Line: The Magazine of the College of Agriculture and Life Sciences

NC State University

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"The State of Agriculture"-- Four Agribusiness leaders and College partners discuss the future of the industry in N.C.-- by Terri Leith.
(From left) Larry Wooten, Lawrence Davenport, Billy Ray Hall and Jim Graham discuss agriculture in North Carolina.
Larry Wooten
Lawrence Davenport
Billy Ray Hall
Jim Graham

"Larry Wooten: Agriculture must move forward as the state moves forward."-- by Terri Leith.North Carolina Farm Bureau President Larry Wooten says North Carolina needs the College of Agriculture and Life Sciences to discover new products and markets for the state's farmers. Photo by Sheri D. Thomas.

Ornate letter "W"
hen it comes to the future of North Carolina agriculture and the role of the state’s lawmakers in that future, Larry Wooten doesn’t mince words. “To not properly fund agricultural research is like a farmer eating his own seed corn,” Wooten says. “To not fund is to put a cap on the growth of the agriculture industry in this state.”

Wooten, president of the North Carolina Farm Bureau Federation and a 1973 graduate of the College of Agriculture and Life Sciences, believes it is crucial that agribusiness leaders statewide remind the legislature of the ongoing importance of agriculture — and the support of agricultural programs — to the economy of the state.

“ I want the legislators and the state from the governor to the Council of State to the departments to know that agriculture is an important part of the economy of North Carolina; it is a working partner and wants to be a working partner in this state. When the leaders of industry, education, business and government are pulled up to the table to discuss the future of our state and its development, agriculture must be at that table. Agriculture must move forward as the state moves forward.”

And that point must be made clear to a governing body that is fast becoming an urban legislature, Wooten says. “Right now in this state, 15 counties elect 50 percent of the General Assembly. The other 85 counties are rural counties — and that’s where agriculture is located. Now, does that have an impact on the funding for the agricultural research? You’re darn right it does.

“ Research funding for agriculture is more complex than it has ever been, and with an urban legislature you have fewer people there who come from an agricultural background and understand the needs. To explain takes longer and is more detailed and technological. That’s why I think we need to look at new ways to make the process more streamlined and applicable to the needs of today.

“ Right now funding is not properly done for agricultural research and does not properly support the research stations in our state.”
Wooten knows the work of the state’s 18 research stations is vital to what he sees as the future of North Carolina agriculture.

“ Agriculture is changing — has to change,” he says. “We’re fast approaching 8 million people in North Carolina, and agriculture has to interface with that growing population. At the same time, the College and its research have to adapt to meet the needs of the state and the farmers out there.”

Wooten sees a movement toward a combination of traditional commodity-based agriculture and product-based, value-added farm programs — and perhaps a new breed of farmers.

“ We’re going to continue to have a diversified, dynamic agriculture in this state, but we’re also going to have diverse types of farmers,” Wooten says. “We’re going to continue to have farmers who come from a long line of traditional farming operations that are still going to be producing some bulk commodities in some areas of the state. I think those farmers will continue to grow in size, as well as sophistication in technology.”

A second type of farmer, he says, “is one who may produce some bulk commodities, and then a portion of that farming operation may be more of a value-added, niche-type market, based on the farm’s location.”

Third, he says, a new type of farmer will evolve. “This farmer may not have grown up on a farm, although there may be farmers a couple of generations in his background. I think this new type will be young people who are much more reliant on technology — biotechnology in particular — and are completely value-added. In other words, whatever they produce, they’ve got a marketing plan to sell it directly. They’ll have much smaller acreage, not high-volume, but it’s more profit-intensive.”

As we look to the future of agriculture in North Carolina, Wooten says, “we must put markets as our primary objective — developing new markets, whether domestically or internationally, and improving markets we have.”

At the same time, he says, “when we talk about economic development in this state, particularly in our rural areas, we must look at what’s already there, native and natural, and build on that to add value, develop markets. We’ve got to create jobs in agriculture in those rural areas, to make sure people are able to prosper in rural communities as well as in the urban areas.”

Wooten recommends a multifaceted approach to market development, which means asking some key questions about any new enterprise: “Have you got the market? Is it sustainable — that is, how long is it going to be a market? What is the capacity of the market — will it sustain 10 growers or 10,000? Do you need 1,000 acres or 10,000 acres to produce for the market?”

Those are questions Wooten asks when he considers proposed enterprises as a member of the Agricultural Advancement Consortium (AAC), a group established by the General Assembly in 2000. “I see the AAC as a clearinghouse for ideas for new enterprises that will improve the profitability of agriculture and develop markets,” he says. “Purely and simply, the consortium’s mission is to help make farming more profitable to our farmers, with an emphasis on market development.”

Larry Wooten at work in his office. Photo by Sheri D. Thomas.

The consortium was instrumental in recently establishing a marketing center for burley tobacco farmers in western North Carolina, through a grant from the tobacco Trust Fund, he says. “The AAC asked for and administered the grant. It enabled our burley tobacco farmers in the west to have options for marketing their tobacco.”

Similarly, with value-added enterprises, cooperative efforts among producers are going to be more prevalent in the future, Wooten says, “because our smaller producers can’t afford to do it alone.” He cites the creation of shared processing facilities, where entrepreneurs and producers, even with dissimilar products, can find ways to share the same facility and the costs.

“ That way,” he says, “their business plans can work.”
The problem that larger farmers have been having with bulk commodity agriculture “is that there’s no profitability right now in bulk commodities,” he says. “Our farmers are depending on government payments to provide any return at all ­— and farmers don’t want that. They’re independent businesspeople. Farmers by nature want to receive profitability from the marketplace.”

If agriculture is currently at a crossroads, Wooten says, “it has to do with exacting more profitability out of agriculture, making our producers understand and become more sophisticated in terms of producing what the consumer wants, rather than producing a commodity and hoping the market will accept what you produce.”

“ That’s the impetus for a new type of thinking in agriculture, and that takes new types of research and new types of funding from the producers themselves through self-help programs such as check-offs, as well as from the state to help support research and market development.”

The College’s role, he says, is “to be on the cutting edge of scouting out new possibilities, potential new products, new markets, to help move agriculture forward.”

Wooten points to the work of Bill Jester, N.C. Cooperative Extension associate for commercial fruits and vegetables, and researchers at the College’s Specialty Crops Program at the R.P. Cunningham Research Station in Kinston. Jester helps farmers diversify and implement alternative enterprises to increase their income.

“ They’re doing a great job in Kinston helping to develop markets. They’re talking about markets first, market development, and then they’re going back and talking about production, about producing FOR the market,” Wooten says. “Development of products that are market-driven, such as the Sprite melon — that’s exciting! That’s really on the right track. I like research that you can see in a relatively short time how it can put money into the pockets of producers.”

Wooten also is enthusiastic about the College’s endeavors in looking at agriculture for energy needs. “Using soybeans to produce fuel, I think that has a tremendous amount of potential. It’s also important that the College is working on ways to turn animal waste into useful products or to create energy. That is a win-win initiative,” he says.

“ The College is doing some great things. Its leadership recognizes this transition we’re in and that there is a place for bulk commodities, for value-added, for organic — for diversity.”

As for any transition from commodity- to product-based agriculture, Wooten says, “We still must recognize that we can’t totally shift. You have to make sure you don’t forget who brought you to the dance. But at the same time you can’t stick your head in the sand and say this is the only way it’s ever going to be in North Carolina. The real challenge for the College is remembering all those differing needs — those of the commodity-based agriculture that’s still going to be here and the new value-added agriculture. The producers need the help, the advice in their business that the College has historically provided.

“ We wouldn’t be where we are in this state in agriculture or in terms of the standard of living were it not for the work particularly of our land-grant universities.”

Among the factors critical to the progress of North Carolina and the health of its economy, he says, “are the partnerships the agricultural industry has enjoyed in this state. They’re the reason we are recognized nationally. I’m talking about partnerships among groups such as the Farm Bureau, as the state’s largest general farm organization; the other great commodity groups in this state; the colleges of agriculture at N.C. State and N.C. A&T; and the N.C. Department of Agriculture and Consumer Services.”

Strong partnerships yield opportunities to pool — not repeat — efforts, he says. “We don’t have the luxury in this state of a lot of duplication and overlapping. We have to work smarter and not battle over turf in getting the job done. The way we do that is through communication, connectivity and interfacing with the partners.”

At the heart of progress, however, will be the resiliency of the state’s agribusiness and its people. “The farmers want a market,” Wooten says. “They want a return to profitability in agriculture. They want to get their money from the marketplace and be able not just to exist but to prosper like other segments of society. They want markets for what they produce. You can't have profitability without the markets."

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"Lawrence Davenport"--"The future depends on whether we can move biotechnology industries into North Carolina."---by Dee Shore

Lawrence Davenport, here in his Pitt County cotton field, sees plant-based products as key to eastern North Carolina's future economic prosperity. Photo by Becky Kirkland.

Ornate letter "F"uels made from soybean oil. Medicines derived from tobacco leaves. Biodegradable films and plastics derived from corn: For Lawrence Davenport, such plant-based products represent the future for agriculture and eastern North Carolina.

As board member and former chairman of Golden LEAF, Davenport has helped invest millions of dollars to make North Carolina more attractive to biotechnology companies that could develop and manufacture such plant-based products.

Some experts predict that biotechnology and related biological sciences will have the same impact on new industry formation that the physical and chemical sciences had in the 20th century. And Davenport wants to make sure that North Carolina and N.C. State University are at the heart of such a transformation.

“ Biotechnology nationwide is the hottest thing going, and every state wants it,” he said. “Right now, North Carolina is one of the top three states in biotechnology, and we have the plant base and the land base in our rural areas where biomanufacturing can really take off.”

To spur growth, Davenport and others announced in August that Golden LEAF — the Long-Term Economic Advancement Foundation — had approved a $64.5 million initiative for biotechnology training. N.C. State University would get $36 million to build a training plant for bioprocessing workers, and N.C. Central University would get $19.1 million for undergraduate and graduate degree programs. Another $9.4 million would go to community colleges for workforce training.

The Golden LEAF funds are part of an estimated $4.6 billion that North Carolina is to receive from the national tobacco settlement. The non-profit foundation was set up by the state legislature to invest and disburse half of the settlement money to improve the economy and create jobs in rural areas hardest hit by the decline in tobacco income.

“ From the start,” Davenport said, those on Golden LEAF’s board have “believed that education, research, job training and creating jobs were where money had to go.”

While some on the board have, from time to time, argued against investing in agricultural projects, Davenport has been an ardent advocate for helping farmers stay in business in the face of declining tobacco demand and increasing foreign competition.

Agriculture is deeply woven into the state’s present and past and won’t easily be replaced, he said. Taken together, agriculture and agribusiness — food, fiber and forestry — generate about one in five jobs in the state and contribute more than 20 percent of the gross state product.

“ It would be absolutely asinine to give up agriculture. We didn’t want to give up textiles — we were forced to give it up,” he said. “We are not going to give up agriculture.”

While adamant about the need for agriculture to remain a leadng industry in North Carolina, Davenport is quick to acknowledge the harsh realities that face him and other producers who form the industry’s backbone.

Davenport is among the fourth generation to farm his family’s land in Pactolus, a small community on the outskirts of Greenville. His great-grandfather walked to the site from Appomattox, where he had been among the Confederate troops who surrendered with Gen. Robert E. Lee. Whether something about the area inspired him or if his feet just gave out, no one knows. But the 17-year-old stopped at a store, got a job, acquired land, started a shirt factory and began the family farm on a fertile sandy ridge along the Tar River.

As chairman of Golden LEAF, Davenport believed the foundation's funds should be invested in agricultural projects. Photo by Becky Kirkland.

Davenport grew up there, and he returned to the farm after working briefly with a fertilizer business following his graduation from the College of Agriculture and Life Sciences in 1965.

Over the years, he’s seen profit margins shrink as commodity prices have declined and expenses have risen.

“ Look,” he said, “we are still selling corn for $2 or $2.25 a bushel — and my grandfather sold corn in the 1950s for $3 bushel. The first corn combine we bought was $12,000. Today, they cost $260,000.”

Recognizing that growing traditional commodities for traditional markets would not remain profitable amid foreign competition, rising labor costs and tougher environmental regulations, Davenport began researching alternatives. After looking into peaches, hogs, cattle, produce, land-clearing — “all kinds of things,” he said — he decided “to settle down with row crops and figure out how to value-add.”

What was a 300-acre farm when he took over now spans 3,000 acres — some of it family owned, the rest rented — of wheat, corn, cotton, soybeans, peanuts and tobacco. Building on a seed-cleaning business his father started, Davenport began producing and selling soybean and wheat seeds, and he later became part-owner of Pitt-Martin Fertilizer Co. In 1991, he joined with a group of other farmers to launch Roanoke-Tar Cotton Inc., a cotton ginning business in Martin County.
Davenport estimates that the businesses generate $5 million to $6 million dollars in sales a year.

Although he operates a large, diversified and firmly established agribusiness, Davenport is not certain whether his son and nephews who have joined the business will continue the family farming tradition.

“ The land is becoming commercially valuable here, and, without a tobacco buyout, we might have to change what we are doing,” he said. “Markets are a tremendous challenge. We are fighting on an uneven basis with foreign competitors who don’t face the kinds of regulations that we do.

“ If it came down to yield and quality, we could put them out of business. But we simply can’t compete on cost. We’ve been able to maintain and do better because of yields, but we are not going to continue to double yields as we have in the past. There’s a limit.”

To compete, farmers need viable alternative crops, alternative markets and alternative uses for the crops that thrive here.

“ We have to make an attempt to find new value-added opportunities,” he says, “whether it’s growing produce for a pick-your-own operation, opening a winery or, for those who operate on the kind of scale we do, getting into things like the crushing business for cottonseed oil.”

With funding from Golden LEAF and other sources, the College of Agriculture and Life Sciences is working to investigate and develop such promising alternative crops as meat goats, organic produce, farm-raised fish, landscape plants and water garden and wetland plants raised in tobacco greenhouses.

Davenport believes that plant-based fuels are among the most promising agricultural alternatives for North Carolina.

“ It’s crazy for us to sit around here and depend on foreign oil. Just look around here and think about all the resources that are right here that can be used to produce fuels that are better for engines and for our air,” he said.

“ We have a similar opportunity to help turn the pharmaceutical industry from a chemical base to a plant base. Manufacturing will move to where the plants are, and that’s out here,” Davenport added. “The future here depends on whether we can move biotechnology industries into North Carolina and into rural areas where jobs are needed.”

Attracting such companies starts with a strong research-and-development base and a well-trained workforce, he said. That’s where N.C. State University and the College of Agriculture and Life Sciences come in.

“ If we are to survive in agriculture — if North Carolina survives as a leading agriculture state — it will only do so as a result of help from N.C. State,” Davenport said. “It’s time for N.C. State to get out in a leadership role — to stay ahead of the game and take care of the problems before they happen. And that takes a lot of vision, resources, intellect and commitment.”

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"Billy Ray Hall"--"Farmers need part of that profit, too."--- by Natalie Hampton.

As president of the N.C. Rural Economic Development Center, Billy Ray Hall is working with the College and other partners to expand opportunities for agricultural entrepreneurs. Photo by Sheri D. Thomas.

Ornate letter "B"usiness and civic leaders attending the N.C. Rural Economic Development Center’s Annual Rural Partners Forum in October learned firsthand about a new initiative designed to bring jobs to rural North Carolina.

Billy Ray Hall, president of the Rural Center, announced the creation of a new partnership – the Institute for Rural Entrepreneurship – designed to develop jobs by supporting new and existing small businesses. Today, businesses with fewer than 50 employees account for more than 95 percent of total rural firms and have experienced significant job growth in the past four years.

The institute, which represents a pool of partners and resources – will provide information, training and financial support to create new jobs in the state’s 85 rural counties. N.C. State’s College of Agriculture and Life Sciences will be one of the partners working to develop opportunities for agriculture entrepreneurs.

Hall, who earned bachelor’s and master’s degrees in economics from N.C. State and has led the Rural Center since its founding it 1987, says the College has worked as a partner with the center from the beginning. Interim Dean Johnny Wynne is a member of the center’s Agricultural Advancement Consortium.

“ Throughout the center’s 16 years, we’ve partnered with N.C. State University and the agriculture community to develop additional income for farmers so they can survive and maintain their position on the land,” Hall said. “We’re very proud of this partnership and hope to build on it in a major way through our new Institute for Rural Entrepreneurship.”

In the new institute, the College and other partners will help expand opportunities for agricultural entrepreneurs through the following initiatives:

• A new generation of agricultural cooperatives program in which groups of farmers make a capital investment in processing facilities or plants, or even a marketing effort that leads to greater profits. The Rural Center will partner with the College, N.C. Department of Agriculture and Consumer Services and N.C. A&T State University.

• An Agricultural Development Grants program that will demonstrate innovative models for value-added business development. One such model is Blue Ridge Food Ventures in Buncombe County, where entrepreneurs will be able develop food products, such as pre-washed, bagged salad greens. The Agricultural Advancement Consortium helped fund the initial study for Blue Ridge Food Ventures, which is organized by Advantage West and the N.C. Department of Agriculture and Consumer Services.

• North Carolina Farm Transitions Network, a partnership between the N.C. Farm Bureau and others including the Agricultural Advancement Consortium, will support efforts to retain farms and farmland in North Carolina between generations of farmers.

• Completion of two important resource documents in 2004 that will give state leaders and farmers information on agricultural issues, trends and resources. The Rural Center and the Agricultural Advancement Consortium will complete The Inventory of Entrepreneurial Investments in Agriculture to document successful, innovative projects in agriculture by county and The Inventory of Agricultural Business Development Resources to identify regional resources for agricultural entrepreneurs. A third document, The Benchmark Report on Agriculture, will explore trends and issues affecting agricultural policy.

The Institute will provide what Hall refers to as the “a renewed effort on the third leg of the economic development stool” – support for small, entrepreneurial businesses. The first and second legs – business recruitment and retention – have been heavily financed and supported over the years, he said.

Agricultural businesses are among those that would benefit from the Institute’s efforts.

“ What we’re doing is pulling together the agricultural community to tackle how we work as a group to promote value-added agriculture. Our primary role is developing information and making money available for our agricultural leaders and professionals to go deeper in their efforts to add value to farm products before those products leave the farm,” Hall said.

Supporting agriculture and rural North Carolina has long been a commitment of both the Rural Center and the College, he said. Over the years, the two have partnered on a number of successful ventures.

When the center first began, it supported a research and demonstration program on breeding Cherokee flour corn, now grown in Cherokee County. Blueberries followed, along with farm-raised catfish and tilapia. The Rural Center has funded the work of the College’s Animal and Poultry Waste Management Center, economic analysis on the impact of tobacco on the state, disaster-relief efforts through Cooperative Extension and more.

Hall said that the College has played a number of roles to support rural North Carolina.

"We're pulling together the agricultural community to promote value-added agriculture," says Hall. Photo by Sheri D. Thomas.

“ Part of the College’s research role is focusing on our agricultural products, which the College does extremely well,” he said. “Second, through the Extension Service, we have the ability to help get the word out about coming changes. That ability to affect thinking and policy making is a critical role of the College, at the local and state level.”

North Carolina farmers face a number of obstacles to profitability today, Hall said. “The biggest obstacle is profitability from agricultural production, given the marketplace on a lot of our commodity crops,” he said.

“ We’re facing a decline in demand for tobacco and reduction of quota. The marketplace is squeezing out dairymen and farmers. The high demand for farmland for alternate uses is driving people off the farm. Inheritance taxes are keeping people from inheriting a workable farm, and the list goes on.

“ In other words, farmers are confronted with a series of market forces, in both the agriculture and nonagriculture communities, to push them away from the farm. And 26 weather disasters in the last seven years have made it darn near impossible to see farming as a profitable way of living,” he said.

“ That combination of crunches leads to two-thirds of the current farmers working off the farm. The one-third that are staying on the farm and earning a living, have got a significant uphill battle to survive.”

To make farming profitable again, Hall said, society will have to turn obstacles into opportunities or reduce their impact significantly. Addressing unfair competition in the global marketplace and modifying tax policies that drive farmers off the land are examples of reducing obstacles, he said.

Another factor is helping a new generation of farmers get more from food dollars by helping them develop a value-added package for the products they grow, he said.

“ Sales at the farm gate in North Carolina run between $8 billion and $9 billion. That’s when you grow it as a commodity and sell it to somebody else,” Hall said. “Agribusiness in North Carolina is a $62 billion industry, so somebody else is getting the profit between that $8 billion or $9 billion and that $62 billion. Farmers need part of that profit too.

“ [N.C. Farm Bureau President] Larry Wooten says the bottom line is marketing. Marketing is taking our product and putting it into a competitive position in world marketplace, and succeeding in increasing the demand for our product and its price.”

As North Carolina agriculture continues to change, the College and its partners will play a critical role in helping farmers make necessary transitions, Hall said.

“ I think the College faces a unique situation. We’re watching the agriculture industry undergo what must be the sixth or seventh major transition, from being a major employer, major source of income, primary policy-driving force in this country and this state, to one of more limited political clout as we shift to an urban nation focused on services,” Hall said. “The College has to be a critical front-line force to protect the stability of agriculture and the future of those who choose to make a living on the land.”

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"Jim Graham: We've got to find out what the world wants and market it."---by Terri Leith.

Jim Graham, who retired in 2000 after 36 years as the state's commissioner of agricuture, remained active in the College and actively interested in the future of North Carolina agriculture, up until his death in November. Photo by Herman Lankford.


Ornate letter "A"s we ponder the future of agriculture in North
Carolina, it is helpful to call upon the thoughts of the late Commissioner Jim Graham on that subject.

His unique perspective was born of his farm-boy roots in Rowan County; his education in the College of Agriculture and Life Sciences at N.C. State (class of 1942); his tenure as a high-school agriculture teacher, superintendent of the Upper Mountain Research Station, manager of the Dixie Classic Fair, secretary of the N.C. Hereford Association and general manager of the Raleigh Farmers Market; and his storied 36-year career as North Carolina Commissioner of Agriculture.

During that time as commissioner, James Allen Graham oversaw North Carolina’s transformation from a one-crop state to one of the nation’s most agriculturally diverse states — and such significant agricultural milestones as the eradication of bovine brucellosis, hog cholera and hog pseudorabies and the elimination of the boll weevil.

Graham, who passed away at 6 a.m. on Nov. 20, 2003, at the age of 82, left behind a legacy of progress and success for North Carolina agriculture — and very definite opinions on what would be essential for that success to continue.

As he looked to the future, he saw the need for a continued collaborative research effort between the N.C. Department of Agriculture and Consumer Services and N.C. State University. “No other state in the nation has this relationship between its department of agriculture and the land-grant university like we have,” he told Perspectives in 2000. “I’m referring to the 16 [now 18] research farms.

“ Future legislators will need to be reminded that we have the abundance of food that we have now because of this relationship. As the tight squeeze comes in, we must not neglect agricultural research. We need it to stay in business.”

As he recognized the trends of commodity prices dropping below the cost of production, Graham foresaw the need for a market-driven agriculture. “We’ve got to find out what the world wants and market it,” he said.

And he predicted that “in the future you’ll see continued growth in cotton as we compete worldwide.”

At the same time, he expressed his enthusiasm for initiatives in the College leading to new, improved and alternative crops.

He saw such activities as the stuff of progress, of necessary change. “‘To improve is to change. To be perfect is to change often.’ That’s from Winston Churchill, and I believe it,” Graham said.

Whatever changes or challenges lie ahead, Graham said, “Agriculture must be kept strong — for health programs, for education programs, for social programs, for university support, for the state to continue to prosper.”

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