14 May 2011

Risk Management by USDA, Arcadia's Biosciences and Full Circle Farms

The Risk Management Agency at the regional  office of USDA mentioned how for commodities that are indexed at the Chicago market the prices depend on that, but for commodities that are not traded there and local to California such as strawberries, almonds and the like then they use locally collected informtion to arrive at some price. In almost all insturances, the federal government gives a subsidy and the agency managing it collects the remaining premium and fee but in case of payout their liability is only 30-60 per cent depending on the crop and the loss. Premiums are paid for nature induced losses interpreted in a broad way. For instance, following the recent Tsunami in Japan and the nuclear disaster some food items were obsorved to be contaminated (which exactly is not nature related),  but as the outcome was in a sense induced by nature they agreed to pay the insurance amount. On the  possibility of farmer and insurance company colluding, they agreed that it can happen and even identified a case where the individuals involved were asked to repay the money - unfortunately, the farmer and his wife ended their lives.

Meeting with Aracadia biosciences revealed that they work largely with bringing technology related, particularly genetically engineered ones, to find solutions to some presing problems of agriculture - salinity, pesticides, and need for increasing yield among others. They indicated about New Rice for Africa (NERICA), also see its wikipedia page here. On the genetical interventions, many questions do still remain - cost of the technology, disregard for alternatie technologies that can be  costly, and of course health implicatio which can only be known 30/40 years down the line if some research is done. For instance, they tried to address nitrogen fixation by genetic modification and cared less for nitrogen fixation by azola or other cost-efffective measures that are locally feasible. Similarly vitamin A fortification leading to Golden rice can be  supplemented by making the populations available milk, egg, carrots or spinach among others.

In contrast to the above, we also visited Full Circle Farms at Davis. A group of four people have rented the place for 600 dollars and provide vegetables, fruits, nuts or eggs under a commuity supported agriculture scheme to 20 families by charging 20 dollars for a week. The labour put in these farms is much more to the conventional farms that are largely mechanized, but one could relate with similar practices in India. One/two more days at Sacramento, California.

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