University Of California Agricultural Issues Center AIC .
University of CaliforniaAgricultural Issues CenterAIC Issues BriefNumber 16May 2001Farmland Conversion: Perceptions and RealitiesNicolai V. Kuminoff, Alvin D. Sokolow and Daniel A. Sumner1Converting farmland into homes and other urban usesis a public issue in every agricultural region experiencingrapid urbanization. In California, the nation s leadingfarm state, the issue is complicated by widely varyingnumbers about the extent of conversion and contrastingopinions about the causes and consequences of farmlandloss.How extensive is farmland conversion in California andwhat are the consequences? Is farmland all-too rapidlydisappearing as new homes, shopping centers, andoffice buildings move out into the countryside,threatening the continued viability of the state sagriculture? Or are there so many acres devoted toagriculture especially in the vast Central Valley that thepresent pace of urban development can continue fordecades without seriously affecting farm production?In this Issues Brief, we examine both the numbers thatmeasure farmland conversions and the related publicperceptions about the causes and consequences ofconversion the basis of arguments about the seriousnessof the problem and its policy solutions. Our analysisdraws from the most reliable sources of informationabout farmland trends and the economics of agriculturein California.Measuring Farmland ConversionCalifornia has 100 million acres of land, split almostevenly between public and private ownership. Abouthalf of the private land is used for agriculture (27 millionacres2) and about one third of the public land is ingrazing allotments (16 million acres) mostly extensiverangeland in the desert and mountains. In total, about43 million acres3 (43%) of the state s lands are inagriculture, compared to about 5.5 million acres in urbanuse.We estimate that about 497,000 acres of Californiafarmland were urbanized in the 1988-98 decade, orabout 49,700 acres a year (Table 1). Our estimate isbased largely on the numbers provided by the sourceof information that most closely tracks statewideagricultural land conversion trends. This is the FarmlandMapping and Monitoring Program (FMMP) of theState Department of Conservation, which since the mid1980s has been measuring urban conversions and otherland use changes at two-year intervals. The FMMPmaps these changes statewide and for individualcounties, using aerial photography and modern soilsurveys.1NicolaiV. Kuminoff is a staff research associate at the UC Agricultural Issues Center. Alvin D. Sokolow is an extensionspecialist in the Department of Human and Community Development, UC Davis, and an associate director of the UCAgricultural Issues Center. Daniel A. Sumner is the Frank H. Buck, Jr. Professor in the Department of Agricultural andResource Economics, UC Davis, and director of the UC Agricultural Issues Center.2Thisestimate is based on our adjustments to Farmland Mapping and Monitoring Program data. The Census of Agriculturereports a smaller total of about 26 million acres. Surprisingly, the amount of privately owned agricultural land is an unsettledquestion.3This estimate, based on 1997 data, may seem large to those familiar with agricultural land use figures. Our calculations areexplained in Appendix 1 to the online version of this Brief, available on the AIC web page, http://aic.ucdavis.edu/oa/briefs.html
Either the paving over or the sufficientfarmland perceptioncan be supported by ourestimate of recent157,443conversion acreage,118,489depending on context58,414and personal values.64,041The conversion of more98,224than a half million acresover ten years or496,61049,700 per year is asubstantial amount thatmany Californians see as an immediate and veryserious environmental threat to their rural landscape.Turning that much farmland into developed acres isroughly equivalent to creating three new cities thegeographic size of Modesto every year.Table 1: California Agricultural Acres Converted to Urban and Built-upUses, 1988-1998 (AIC Calculations based on FMMP o generate an estimate of total California farmlandthat was urbanized in 1988-98 we begin with the420,000 acres measured by FMMP as convertedfrom agricultural and other 4 land to urban uses.However, FMMP s measure does not include urbandevelopment on parcels smaller than 10 acres thatare surrounded by farmland, and certain types of lowdensity residential development. In addition, FMMPdoes not map about 10% of the state s private land.To develop our estimate of almost 497,000 acres,we added to the FMMP total another 77,000 acresto account for these conversions.5Much larger conversion numbers are reported byother sources. For example, the National ResourcesInventory (NRI), a program of the USDA NaturalResources Conservation Service, reported for 199297 an increase in California s developed acres ofabout 112,000 acres a year more than double theannual average implied by our calculations. In placeof the state s comprehensive aerial mapping system,the NRI uses sample landscape points to estimateland use changes.Competing perceptions: Urban growth is pavingover California farmland versus We havesufficient farmland there is no conversionproblem. Yet the conversion numbers seem small whencompared to California s supply of privately ownedfarmland, about 27 million acres as of 1997. The497,000 acres converted in 1988-98 were only 1.8percent of this agricultural land base in 1988,amounting to an annual rate of less than two-tenths ofone percent (0.18%). At that rate, others havesuggested, the present pace of urban developmentcould continue for decades without severely affectingthe total production of California agriculture.In fact California agriculture prospered economicallyin the last half of the 20th Century, a period of rapidand extensive urbanization. During these 50 years thestate s agricultural landscape was substantiallychanged as urban and suburban development cutsharply into the agricultural production of coastalareas, particularly in the Los Angeles and SanFrancisco Bay regions. Yet California s farmproduction and market value increased greatly duringthis period, with agricultural cash receipts almostdoubling from 13 billion in 1950 to 25 billion in4We include other in the calculation of total urban conversions because in the development process, farmland is often takenout of production and reclassified as other by the FMMP for several years before actual building occurs.5Our calculations are explained in more detail in Appendix 2 to the online version of this Brief, http://aic.ucdavis.edu/oa/briefs.html2
1997 and net farm income increasing from 4.8 billionto 6.1 billion (both in constant 1996 dollars). Severaldevelopments made this possible: (1) Expanded fruit,vegetable, nut and vine production in the CentralValley, (2) Increased water supplies from federal andstate reservoirs and canals for agricultural use in theCentral Valley, leading particularly to new plantingson the Valley s west side, and (3) Improvements infarm technology that increased per acre productivity.Future prospectsIf we base future projections on FMMP data for thepast ten years, it is easy to assume that urbanizationwill not seriously threaten California s enormousfarmland base for many years to come. The CentralValley, with its horizon-to-horizon agriculturallandscape, seems to contain an almost inexhaustiblesupply of productive farmland currently about 6.7million cropland acres and another 6.9 million devotedto grazing. This is a major point made by opponentsof strong farmland protection and growth controlmeasures.But a number of uncertainties complicate the pictureand suggest that farmland conversion is a more seriousmatter than implied by the FMMP numbers. Here areseveral factors that should be considered in anycomprehensive deliberation about California sfarmland base:(1) Most significantly, direct urbanization is only oneform of farmland loss. Agricultural acres are alsoconverted to environmental uses or, for economicreasons, are left idle for long periods or permanentlytaken out of production. The FMMP does not countsuch changes as direct urbanization, but includes themin the broad other land category. Agricultural to other conversions can include land converted towetlands and wildlife habitat, land temporarily idledbefore eventual development (at least 4 years), andland taken out of production because of higher pricesfor inputs, such as water, or lower crop prices.According to our calculations based on FMMP data,farmland transferred to the other category in 198898 totaled about 167,000 net acres about half ofthe direct agricultural-urban conversion total of311,000 acres. During the 1996-98 period,agricultural to other transfers sharply increased, risingto 74,000 acres from 40,500 in 1994-96.It is likely that the retirement of farmland for theseenvironmental and water-related reasons will increasein the near future, especially in the Central Valley,exceeding urbanization as the principal contributor toconversions. Several indications point in this direction,including the steady expansion of the habitat andwetlands restoration programs of federal and stategovernments and nonprofit organizations, the transferof water from agricultural to environmental uses throughthe CalFed process, and the increasing retirement offarmland on the west side of the San Joaquin Valleydue to the buildup of salts and the lack of effectivedrainage. In the last few months the Westlands WaterDistrict, in response to water and drainage problems,announced plans to seek a federal/state buyout of200,000 farmland acres an amount equal to fouryears of statewide urban conversions.(2) Statewide numbers mask local variations. Whatmost stimulates public concern about conversions isthe sight of farm fields giving way to new residentialsubdivisions and shopping centers, and office buildingsaccompanied by vast parking lots. These signs ofconversion are vivid around rapidly expanding citiesin agricultural areas such as Tracy, Bakersfield,Stockton, Brentwood, Manteca, and Morgan Hill.Conversion activity in such locations is immediatelyvisible to urban and suburban people, while most ofCalifornia s agricultural acres are in more remote areaswhere relatively little urbanization occurs.(3) The best cropland is more likely to be convertedto urban uses. Between 1988 and 1998, primecropland accounted for about 30 percent of farmlandacres converted, although it represented only 18percent of the state s total agricultural land. Similarly,other cropland constituted 36 percent of conversionsand 25 percent of the agricultural land base. Incontrast, grazing acreage accounted for only 34percent of the converted acres, but 57 percent of theagricultural land base (FMMP). The greater share of3
prime cropland converted is largely due to its suitabilityfor development and its proximity to existingdevelopment. Grazing land tends to be more remotefrom urban areas or located on harder-to-develophillsides.(4) The future rate of farmland-to-urban conversionis uncertain and could increase as previousdevelopment makes urban infrastructure moreavailable. Development density and population growthare additional sources of uncertainty. Between 1988and 1998 California s population grew by about 19%,or 5.4 million, (California Department of Finance)while, by our estimate, about 497,000 acres of thestate s farmland were converted to urban uses. Thistranslates to an average development density of about0.1 acres of converted farmland per new resident.The California Department of Finance projects thatCalifornia s population will grow to 58.7 million by2040. If we assume a continuation of the 0.1development density, this population increase wouldcorrespond to about 2.5 million acres of farmlandconverted. A lower development density or higherthan-projected population growth would imply evenmore conversion.Perceptions about the Causes ofFarmland Conversions High prices or revenue through governmentsupport can slow or stop farmlandconversion Some argue that slowing farmland conversion can beaccomplished by giving farmers higher prices for theircommodities through increased federal governmentfarm subsidies. In theory this could be true. Farmers,like other business people, balance the profit they getfrom their investment in land across various uses.Therefore more total money in farming may reduceland transfers out of farming. However, the relativeprices involved make it very implausible thatgovernment payments will keep much land fromshifting out of farming.The difference in the price per acre for land inagricultural production and agricultural land fordevelopment is typically large. In urbanizing areas,bare ground sold for development regularly exceeds 40,000 per acre, considerably more if urbanimprovements are in place. Meanwhile, the averageagricultural land prices in California are muchsmaller 1,050 for grazing land and 5,500 for fruit,tree-nut and vegetable areas (National AgriculturalStatistics Service).6 Further, the differences betweenurban and agricultural land prices are largest for thosecrops that have had government subsidy programs generally field crops such as grains and cotton. Thisdifference is so large that raising commodity priceshigh enough to effectively outbid developers wouldrequire such massive per unit crop subsidies thatbudget costs would be prohibitive. For example, if ittook 30,000 per acre to keep cotton land from beingdeveloped, price supports would have to be about 2.87 per pound, compared to market prices ofroughly 0.75.7 Even for high value crops such aswine grapes or fresh vegetables, farmland values donot approach the value of the land for urban uses.And these crops have not been the subject of farmprice policy.Naturally, we might expect more farmland conversionduring times of lower prices or when governmentpayments are not available. In these cases, cash flowproblems may encourage the sale now, rather than ina few years. Of course, some landowners like to farmand will keep their land in farming if they can earn aminimum return. For them, agricultural earnings donot have to compete with the sale price of land forurban development. However, farmland owners whowant to continue to farm often can sell acreage in anurbanized location and shift their farming operationsto a more remote area. Indeed, this move has allowed6In extreme cases, farmland can be more expensive. Napa County vineyards, for example, have sold for as much as 90,000 per acre(American Society of Farm Managers and Rural Appraisers).7This assumes the per acre price of cotton land is about 3,000, which we infer to be conservatively large given land prices for fieldcrops listed in Trends in Agricultural Land and Lease Values. We also assume the discount rate is 12%, reflecting farmers uncertainty about the specifics of the program s future.4
many farmers access to capital to expand theiroperation and solidify their future in farming. Scratch a farmer and you find a developer This popular expression has its basis in the speculativevalue of land that is being used to grow commodities,a value much greater for urban development than forcontinued farming as the numbers cited above indicate.This land value is the principal financial asset for mostfarmland owners, representing economic security forretirement income, bequests, or other uses.However, the likelihood of an individual farmerbecoming a developer is limited. Few farmland ownersactually have the immediate or foreseeable opportunityto sell, simply because their parcels are not in the rightplace as dictated by local land markets and city andcounty government growth policies. Thus,opportunities for turning rural land into residential andother urban uses are generally confined to the fringesof expanding cities and other urban areas. MostCalifornia farmland, particularly in the Central Valley,North Coast and desert valleys, is located far fromthe urbanizing fringes.Patterns of concentrated urbanization in California arepartly the result of county planning and land usepolicies frequently in cooperation with citygovernments that limit new development inagricultural areas, and instead direct it toward cities.This limits cash-out opportunities to a relatively smallnumber of landowners, and also produces morecompact development, thus decreasing the volume offarm acres converted to urban uses. Not all Californiacounties follow such a city-oriented growth strategy,but it is the prevalent land use policy in such agriculturalcounties as Fresno, Tulare, Merced, Yolo, Napa andSolano.Even many landowners with agricultural properties inthe shadow of urban areas prefer to continue farming.Perhaps the path of urbanization is not moving in theirdirection, but personal and economic factors also areat work. Most farmers generally enjoy their occupationand would like to continue, assuming they can rideout price fluctuations, weather and pests, and are ableto provide adequately for their families. Of course,this attitude varies according to circumstances, withresistance to selling fortified by such factors as familytradition, personal attachment to the land, the farmparcel serving also as a home site, and the directinvolvement of the landowner in the farm operation.Perceptions about the Effects ofFarmland Conversion Continued urbanization will prevent Californiafrom feeding itself Food security and self-sufficiency is one commonargument for strong farmland protection programs.Two misconceptions are implicit in this argument. Oneis that California produces most of its own food andwould have shortages if its farmland was developedfor urban use. In fact, most food consumed byCalifornians is brought in from other states andcountries, while most California farm production isshipped out-of-state. Californians buy meat, grains,and even some fruits and vegetables from out of statesources, while the state produces more than half thefruit, nut, and vegetable crops consumed in the rest ofthe United States. For many commodities Californiais the leading producer and supplier to the rest of thenation. If these trade patterns did not hold, many foodswould be much more expensive than they are now.However, large-scale farmland conversions thatreduce the production of certain commodities couldaffect local and even international food markets. Forexample, if a large share of California avocado,artichoke or almond land was converted, marketprices would be significantly affected, at least whileadjustment took place, because California is thedominant producer of these crops. But these are notthe crops people typically mean when they refer to food security. Also, prices would rise for allconsumers, not just those in California.The second misconception is that gradual decreasesin farmland necessarily lead to actual declines in overallfood production. This has certainly not been the caseup to now in California where agricultural productivityhas increased much faster than the agricultural land5
base has declined. The real value of averageagricultural production per acre (in constant 1996dollars) increased from 422 in 1964 to 928 in 1997,while the relative price of food declined.8 With acouple of exceptions, production quantities ofCalifornia crops have increased dramatically sincemid-century. For example, while average harvestedacres of wheat decreased slightly between 1950-54and 1995-99, production increased by 350%,outpacing the state s population growth. Other majorcommodities whose production increases outpacedpopulation growth include rice, lettuce, processingtomatoes and walnuts.While farmland conversion does not threatenCalifornia s food security, it is certainly true that if alarge part of the Central Valley were converted thestate s agricultural production would decrease. Evenif farms were to relocate elsewhere in California, thereare no other large areas in the state comparable tothe Central Valley in soil quality, water availability andother favorable growing conditions. Thus, it wouldnot be possible to repeat the relocation scenario ofthe 1950-80 period when production of horticulturalcrops expanded in the Central Valley while farmlandwas being urbanized in coastal regions. Farmland conversion generates public sectorcosts Studies conducted by the American Farmland Trustand other organizations usually support thegeneralization that when taxes and other publicrevenues are balanced against public expenditures,farmland produces a net gain for local jurisdictionswhile urban land use results in financial costs. However,the type of urban development tends to dictate whetherfarmland conversion generates a net financial gain orloss for local governments.Much of the fiscal gain for local communities fromurban development is short-run, generated by initialdevelopment and construction activities. In the longrun, it is far more costly for local governments toprovide public services and facilities to urban than toagricultural areas. The critical distinction is howdifferent forms of development affect the balance oflocal revenues and expenditures. Under California slocal public revenue system, new housing, factories,and stores do not pay their own way in local tax termsbecause of limitations on the property tax. However,retail development often generates a net gain for localgovernments because of sales tax receipts. This is whylocal governments often aggressively compete forstores but accept residential development with lessenthusiasm. Farmland conversion hurts local economiesbecause of agriculture s economic multipliereffects Each dollar earned by agriculture or any other businessstimulates additional indirect economic activity in theinput and processing sectors in the form of jobs,income and output. The combined direct and indirecteconomic impacts of farming accounted for about 6.6percent of California s income and 7.4 percent of itsjobs in 1998. The proportions are much higher wherelocal economies are dominated by agriculture. In theSan Joaquin Valley, for example, agriculture accountsfor 31.7 percent of local income and 36.9 percent ofall jobs.Nevertheless, communities and regions generally gainin overall economic terms when farmland conversionsoccur, through economic diversification, new jobs andhigher incomes. As in the impacts on public sectorfinances, much depends on the mix of residential,commercial, industrial and other urban developmentthat replaces farmland. Higher income jobs, forexample, are more associated with certain kinds ofindustrial and office development than with retail stores.The jobs/housing balance of new development alsohelps determine how urbanization will affect the localeconomy. Overall, the economic return in income andjobs from urban land use is usually greater on a peracre basis than the return from farming.Another misleading aspect of this perception is theemphasis on lost farm production that results fromthe conversion of particular parcels. In California slarge and flexible agricultural industry, particular8Calculated as the ratio of the Food Retail Price Index to the Consumer Price Index, the relative price declined from 1.1 to 1.0.6
conversions do not generally bring about a netdecrease in statewide or regional production, sincethe lost output can be replaced by shifting to otherlocations. Agricultural land provides open space,environmental, and social amenities Agricultural acres are a major form of open space,leading to one of the most powerful arguments onbehalf of farmland protection. The aspect of thefarmland conversion issue that most engages urbanand suburban residents is the strong belief that nearbyagriculture improves a community s quality of lifethrough its visual and other aesthetic properties, habitatuses, and contrast with urban congestion. Further,access to locally grown products at farmers marketsand other outlets is appealing to many.To the extent that farmland provides aesthetic or othernon-market values to urban and suburban residents,it becomes a socially valuable public good, havingvalue separate from the economic benefit of producingmarketable commodities. A natural policy responsewould be to provide public funds reflecting the amenityvalue of farmland to compensate landowners formaintaining their acreage in agriculture.In California, land use policies are now moving in thisdirection. State and local governments have long soughtto preserve farmland from urbanization throughregulatory and planning measures, including agriculturalzoning, controls on city expansion, environmentalreview, and general plans. The current policy shift isto a greater emphasis on market-based compensatorymeasures for protecting farmland, particularly thepurchase of development rights from landowners inthe form of conservation easements, and a new versionof the Williamson Act that grants a larger property taxcut to farmland owners with longer contracts. Primarilyin the form of nonprofit land trusts, local conservationeasement programs focused on farmland are rapidlyexpanding in California, muted somewhat by limitedrevenue sources and uncertainties on the part oflandowners.ConclusionsMany in California and elsewhere readily support thepreservation of farmland in the face of urbanization.Evidence for this is seen in public opinion poll results,newspaper editorials and letters-to-the editor, as wellas public support for policies that promote farmlandpreservation. Yet both the continuing public debateabout the conversion issue and informed public policyrequire numbers and arguments that do not exaggeratethe extent of the problem or misinterpret its causesand consequences.Farmland conversion is a serious issue in California.The evidence shows that its effects are more longterm than immediate, more visible in particular localitiesthan statewide, and involve more than directagriculture-to-urban changes. In the future, more landmay be taken out of production because of limitedwater supply and for habitat restoration than becauseof urban expansion. Whatever the scenario, thenumbers reflecting recent and current conversion ratesshould not be a cause for either complacency or panic.ReferencesAmerican Farmland Trust, Farmland InformationCenter, Cost of Community Services Studies: FactSheet, online data, June 1999, www.farmlandinfo.org.California Department of Finance, DemographicResearch Unit, County Population Projections withRace/Ethnic Detail. Sacramento, California,December 1998.California Chapter of the American Society of FarmManagers and Rural Appraisers, Trends inAgricultural Land and Lease Values, SpringAgricultural Outlook Forum, 2000.California Department of Conservation, FarmlandMapping and Monitoring Program, FarmlandConversion Reports, various years.Elitzak, Howard, United States Department ofAgriculture, Economic Research Service, Food and(Continued on page 8)7
8(Continued from page 7)Rural Economics Division, Food Cost Review, 19501997, Agricultural Economic Report no. 780, June 1999.Kuminoff, Nicolai V. and Daniel A. Sumner, withGeorge Goldman, The Measure of CaliforniaAgriculture, 2000, University of California AgriculturalIssues Center, November 2000.United States Department of Agriculture, NationalAgricultural Statistics Service, Agricultural LandValues, March 2000, r/plr-bb/.United States Department of Agriculture, NaturalResources Conservation Service, Natural ResourcesInventory, 1997, Summary Report, revised December2000.United States Department of Labor, Bureau of LaborStatistics, Consumer Price Index, online data, http://stats.bls.gov/datahome.htm.AIC Issues Briefs are published periodically by theUniversity of California Agricultural Issues CenterOne Shields Avenue, Davis, CA 95616-8514Contact us:Email: agissues@ucdavis.eduFax: 530 752 5451Telephone: 530 752 2320.The AIC Quarterlies, AIC Issues Briefs, a complete list of our publicationsand more are on our website at http://aic.ucdavis.edu
farmland on the west side of the San Joaquin Valley due to the buildup of salts and the lack of effective drainage. In the last few months the Westlands Water District, in response to water and drainage problems, announced plans to seek a federal/state buyout of 200,000 farmland acresŠan amount equal to four years of statewide urban conversions.
The following At-A-Glance charts present comparative admission, cost, curricula and other relevant information about the state universities. . Agricultural Communications Agricultural Economics Agricultural Industries Agricultural Mechanization Agricultural Occupational Education Agricultural Production Agricultural Science Agronomy, Field Crops
An Agricultural Pest Control Adviser (PCA) is any person who offers a recommendation on any agricultural use, holds himself/herself as an aut rit y on an agricultural use, or solicits services or sales for any agricultural use (Food and Agricultural Code [FAC] sections 11410, 11411). emption You are exempt from this licensing requirement if you .
India’s food and agricultural exports jumped from 16.8 billion in 2009 to 35.06 billion in 2015. For an overview of the Indian market and agricultural trade, read the USDA Foreign Agricultural Service International Agricultural Trade Report from December 2016: India Agricultural Trade: Expanding Export Opportunities Amid Persistent Limitations.
agricultural purpo es ange of land use from agricultural to non-(e) "Cloyemmenr ml!lTthTstat Agricultural land; (I) "Collector" means of Andhra Pradesh; agricultural land for Collector in whose jurisdiction the conversion is applied for is situated and also * 2-1-2006";; o.M,.No, .93, Revenue 372
Dawson (2005) examined contribution of agricultural exports to growth in developing nations. The first model was based on agricultural production function, including agricultural and non-agricultural exports. The second model included agricultural and non-agricultural where each sector was sub divided into exports and non-export sector.
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