The Americas Are Falling Behind in New Agricultural Technologies. Here’s How to Catch Up.

By Ginger Matchett and Peter Engelke

It is no secret that the Western Hemisphere is an agri-food powerhouse. It is home to over half of the world’s top producers and exporters of staple crops, including soybeans, corn, wheat, and rice. Additionally, countries across the Americas produce and export dozens of specialized crops, including coffee, blueberries, oranges, bananas, and much more. Investment into the research and development of agricultural technologies (AgTech) and practices has been a key reason why the hemisphere leads the world in so many areas of food production. However, that leading position is faltering as other countries have begun to surpass the Americas in productivity gains and investment into agriculture research and development (AgR&D). If the Western Hemisphere hopes to maintain its competitiveness, it must prioritize innovation, or it risks losing its dominant position.

On July 23, the Scowcroft Center for Strategy and Security’s GeoStrategy Initiative, in partnership with The Mosaic Company, hosted the third private roundtable of the Food security: Strategic alignment in the Americas project. The roundtable brought together dozens of leading experts from across the Western Hemisphere, representing research organizations, universities, agri-food companies, governments, and multilateral institutions. In the discussion, a central theme emerged the importance of innovation in the agriculture sector and investing in AgR&D across the hemisphere.

Robust AgR&D strategies play a central role in advancing food security. The AgTech that follows from investment in AgR&D has been one of the reasons why the agricultural sector in the Americas’ largest producers of staple crops—Brazil, Argentina, Mexico, Canada, and the United States—became world leaders. Capabilities in AgTech, however, are not evenly distributed across the Americas, neither among the five largest agricultural producers nor the hemisphere’s many smaller producers.

The United States offers an important example of just how critical investment in AgR&D is, as well as the pitfalls that follow if such investment falters. For decades after World War II, public and private investment in agricultural innovation in the United States dramatically increased on- and off-farm productivity, with an average annual growth in total factor productivity (TFP) between 1948 and 2017 of 1.47 percent. Productivity growth was due mainly to capital improvements (versus land or labor expansion, which along with capital are the three components of the TFP metric). The US Department of Agriculture (USDA) asserted that TFP increases over this seventy-year period “can be attributed to the advent of new technologies, innovations, and process improvements in the farm sector.” Extension programs, led by local universities and supported through public investment, have significantly aided these productivity gains. Extension services provide open and accessible education and training on science-based, modern technologies to farmers, consumers, and families.

Despite the effectiveness of such investment the USDA estimates that every dollar of AgR&D generates twenty dollars in economic benefits US public investment in agricultural innovation has declined by one-third over the past twenty years. Since its 2002 investment peak, the United States has fallen behind on investment increases compared to its biggest competitors, including China, India, Brazil, and the European Union (EU). By the late 2010s, both China and the EU were investing significantly more public funds than the United States, with India and Brazil not far behind. Around 2013, China surpassed the United States as the world’s largest public funder of AgR&D, apart from the EU, with its investments by 2022 close to doubling those of the United States. Over the same period, however, private sector AgR&D funding climbed in the United States, helping to offset the decline in public sector investment. Whether that additional private spending has been enough in quantity or kind to offset the drop in public investment remains an open question; USDA data indicate that TFP in US agriculture peaked in 2009 and then declined by approximately 6 percent over the following decade. (As is true generally, in the agricultural space, private sector R&D focuses on proprietary technologies and marketable innovations, requiring that public investment fill gaps in areas that lack commercial incentives but are nonetheless vital for global food security.)