Characteristics of the Food and Agricultural System

Consumer Driven

The U.S. food and agricultural system is increasingly driven by consumers' preferences and concerns, in keeping with its its role in a highly developed economy. Today these preferences and concerns encompass price, sensory attributes, nutrition, convenience, variety, food safety, diet-related health, cultural and ethnic preferences, and concerns regarding the methods of producing foods and raising animals and their impacts. Most of the economic value in the food and agricultural system is generated outside the farm gate as commodities are transformed for consumer markets through processing, manufacturing, and packaging and differentiated to meet specific consumer preferences. Additionally, farm production practices, the goals of plant and animal breeding, and the application of biotechnology to crops and livestock are themselves increasingly responsive to consumer preferences and concerns. Yet, at the same time that consumer-oriented markets are a driving force in the food and agricultural system, consumers themselves often have less (or asymmetric) information about the qualities and embodied attributes, particularly nonsensory attributes, of food and agricultural products than do manufacturers and suppliers. Incomplete or inaccurate information precludes consumers from always making well-informed changes in consumption patterns, thus market forces may not influence product and technology development in ways that best serve consumers' needs (see Box text, pp. 16–17). Although public policy includes labeling, food safety, and other production certification standards, the situation creates the need for public sector research.

Ecosystem Accountability

The food and agricultural system is increasingly asked to be accountable to an urban- and suburban-based public for its conservation of natural resources such as water, soil, rangeland, and fossil fuels and for protection of environmental amenities spanning open space, wildlife habitat, and water and air quality. Farmers are asked to be—and many want to be—effective natural resource stewards and ecosystem managers. They consequently face an increasingly complex policy and regulatory environment; they require new knowledge and expertise regarding management and technological alternatives that can help them manage pests and control disease, be profitable and competitive, and be accountable to public concerns.

Global Markets

The food and agricultural system is a global system. Significant shares of not only bulk commodities but also processed food and agricultural products enter global markets in search of new customers, creating jobs in export-oriented industries, and generating foreign exchange for the nation. Goods, capital, and technology flow readily across national boundaries expanding trade, foreign investment, and technological opportunities in the food and agricultural industry and contributing to global economic growth, while creating a more intensely competitive environment for producers, firms, and workers. A global system also means that U.S. consumers cannot be insulated from pressures on food and agricultural markets that might occur as world population continues to expand in the presence of constrained resources or unsustainable resource use. Thus both U.S. and non-U.S. consumers and producers share interests in science and research that continue to improve the efficiency of global markets and the sustainability of production systems.

Biotechnology's Role

Food and agricultural production is increasingly science based, and the food and agricultural system is increasingly able to capitalize on scientists' growing command of



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