Economics, Technology, and Politics: Opportunities for ... · Economics, Technology, and Politics:...

8th Annual Farmers COOP Conf.

2005

Economics, Technology, and Politics:

Opportunities for Agriculture

Economics, Technology, and Economics, Technology, and Politics:Politics:

Opportunities for Opportunities for AgricultureAgriculture

Dr. Bernard Y. Tao

Dept. of Agricultural and Biological Engineering

Purdue University

Dr. Bernard Y. TaoDr. Bernard Y. Tao

Dept. of Agricultural and Biological EngineeringDept. of Agricultural and Biological Engineering

Purdue UniversityPurdue University


2005

TakeTake--Home PointsHome Points

•U.S. economic growth depends on developing novel products and technologies

•The biological sciences are be the next major technological driver for economic growth

•Immense social needs have created opportunities to re-link ‘agriculture’ and ‘industry’ through vertical integration, industrial partnerships

•Universities are developing the entrepreneurial human resources and technologies needed for this economic growth

•Success depends on infrastructure development and political vision/implementation







2005

Back to the Future:Back to the Future:

Historical PerspectivesHistorical Perspectives


2005

Shifts in EconomiesShifts in Economies

Source: Marvin Source: Marvin ZonisZonis & Associates& Associates

May you live in changing times.

- Ancient Chinese Blessing/Curse


2005


Real U.S. GDP (adjusted for inflation)

$0.00

$2,000.00

$4,000.00

$6,000.00

$8,000.00

$10,000.00

$12,000.00

1750 1800 1850 1900 1950 2000 2050

year

GD

P in b

illions o

f $ b

ased o

n 2

000

dollars


2005

How does the U.S. build such a How does the U.S. build such a

historically strong economy?historically strong economy?

�� U.S. economic competitiveness depends U.S. economic competitiveness depends on having innovative, high value on having innovative, high value products to sell products to sell –– Processed food productsProcessed food products

–– High quality steelHigh quality steel

–– Novel polymers and chemicalsNovel polymers and chemicals

–– Automotive/Aerospace transportationAutomotive/Aerospace transportation

–– Electronics/computersElectronics/computers

–– Pharmaceuticals/medicinesPharmaceuticals/medicines


2005

How did we get here?How did we get here?

�� Entrepreneurship and Entrepreneurship and education are critical to education are critical to developing new high value developing new high value technologies/products that technologies/products that cannot be made elsewherecannot be made elsewhere

�� U.S. has always been a leader U.S. has always been a leader in innovative entrepreneurship in innovative entrepreneurship in technology and productsin technology and products

�� U.S. always been a leader in U.S. always been a leader in educationeducation


2005


2005

Who are our competitors in the Who are our competitors in the

next generation economy?next generation economy?


2005

How are other nations overtaking How are other nations overtaking

the U.S. economy?the U.S. economy?�� Historical U.S. innovated products are going to high Historical U.S. innovated products are going to high

volume, low cost producer economiesvolume, low cost producer economies

–– Computers, cell phones, steel, automobiles, clothing, Computers, cell phones, steel, automobiles, clothing,

fuels, plastics, chemicals, digital cameras, internet, etc.fuels, plastics, chemicals, digital cameras, internet, etc.

�� The U.S. consumer is funding the capitalization of The U.S. consumer is funding the capitalization of

high volume, low cost producershigh volume, low cost producers

–– China, Korea, India, Mexico, etc.China, Korea, India, Mexico, etc.

�� U.S. schools educate the top international students U.S. schools educate the top international students

who return to their homes to rev up national who return to their homes to rev up national

economies economies


2005

Where is the U.S. Economy Where is the U.S. Economy

Going?Going?

�� Without new, innovative technologies and Without new, innovative technologies and products, the U.S. economy will decline products, the U.S. economy will decline (competition for low paying production jobs)(competition for low paying production jobs)

�� What will drive the creation of innovative new What will drive the creation of innovative new technologies/products in this century?technologies/products in this century?

�� BiologicallyBiologically--based technologies, Education, based technologies, Education, and Entrepreneurshipand Entrepreneurship


2005


Source: Marvin Source: Marvin ZonisZonis & Associates& Associates

May you live in changing times.

- Ancient Chinese Blessing/Curse


2005

Petrochemical

Era

Railroad

Era

Information

AgeSteam Engine

Era

50-Year Cycles “Inherent In

The Capitalistic Economy”

Driven by new Technologies

18301830 18801880 19301930 19801980 2030203017801780

"Bury me on my face," said Diogenes; and when he was asked why, he replied, "Because in a little while everything will be turned upside down." - Socrates

Fundamental Changes in TechnologyFundamental Changes in Technology

Nikolai Dimitriyevitch Kontratyev

Long-Wave Cycle

Biological

Age

20802080

Water Power

Era

•Technology changes driving industrial growth, phase frequency ~50 years•Technology shifts do not mean technology vanishes


2005

0

50

100

0 10 20 30 40 50

Years

Economic ActivityEconomic Activity

Fundamental Economic Changes Driving Engineering Fundamental Economic Changes Driving Engineering

Oil In Declining PhaseOil In Declining Phase Biotechnology Initial PhaseBiotechnology Initial Phase

Chemical Engineering Biological Engineering

Implications:•Science has ~20 year lead to shape technology•Investments in industries change in anticipation of new technologies•Industries employing graduates will change•Educational processes usually lag behind technology changes

0

50

100

0 10 20 30 40 50

Years


Internet / EInternet / E--commercecommerce

growth phasegrowth phase

0

50

100

0 10 20 30 40 50

Years


EE/Computer Engineering


2005

The Top 25 US Companies by Market Value Economy FocusThe Top 25 US Companies by Market Value Economy Focus

Source: University of Chicago, Standard & Poor’s

1969 1979 1989 1999Rank Company Mkt Cap Company Mkt Cap Company Mkt Cap Company Mkt Cap

1 IBM $41.5 IBM $37.6 Exxon $62.5 Microsoft $601.0

2 AT&T 26.7 AT&T 36.6 GE 58.4 GE 507.2

3 General Motors 19.8 Exxon 24.2 IBM 54.1 Cisco 355.1

4 Eastman Kodak 13.3 General Motors 14.5 AT&T 48.9 Wal-Mart 307.9

5 Exxon 13.3 Schlumberger 11.9 Phillip Morris 38.7 Exxon Mobil 278.7

6 Sears, Roebuck 10.5 Amoco 11.8 Merck 30.6 Intel 275.0

7 Texaco 8.3 Mobil 11.7 Bristol-Myers Squibb 29.4 Lucent 228.7

8 Xerox 8.2 GE 11.5 Dupont 28.1 AT&T 226.7

9 GE 7.0 Sohio 10.8 Amoco 27.9 IBM 196.6

10 Gulf Oil 6.4 Chevron 9.6 Bell South 27.9 Citigroup 187.5

11 3M 6.0 Atlantic Richfield 9.3 Coca-Cola 26.0 America Online 169.5

12 Dupont 4.9 Texaco 7.8 General Motors 25.6 AIG 167.4

13 Avon Products 4.9 Eastman Kodak 7.8 Mobil 25.6 Oracle 159.5

14 Coca-Cola 4.7 Phillips Petroleum 7.4 Wal-Mart 25.4 Home Depot 158.2

15 Mobil 4.7 Gulf Oil 6.8 Procter & Gamble 24.3 Merck 157.1

16 Procter & Gamble 4.5 Procter & Gamble 6.1 Chevron 24.1 MCI Worldcom 149.3

17 Chevron 4.3 Getty Oil 6.1 GTE 23.1 Procter & Gamble 144.2

18 Polaroid 4.1 3M 5.9 Bell Atlantic 21.9 Coca-Cola 143.9

19 Merck 4.1 Dupont 5.8 Pacific Telesis 21.0 Dell Computer 130.1

20 Atlantic Richfield 3.8 Dow Chemical 5.8 Ford Motor 20.6 Bristol-Myers Squibb 127.3

21 American Home Prod 3.6 Sears, Roebuck 5.7 Johnson & Johnson 19.8 Pfizer 125.6

22 ITT 3.5 Merck 5.4 Dow Chemical 19.2 Johnson & Johnson 125.3

23 Amoco 3.4 Xerox 5.2 SBC Communications 19.2 Sun Microsystems 121.0

24 Johnson & Johnson 3.3 Conoco 5.1 Eli Lilly 19.1 Hewlett-Packard 115.9

25 GTE 3.2 Halliburton 5.0 Ameritech 18.4 Yahoo! 113.9


2005

What does History Teach Us?What does History Teach Us?

�� Technology is the driver for economic developmentTechnology is the driver for economic development

�� Shifts in technologies for change foundational Shifts in technologies for change foundational industrial/social infrastructureindustrial/social infrastructure

�� Those who adopt changes early have the best Those who adopt changes early have the best opportunities to benefitopportunities to benefit

�� There is about a 20 year lag time between scientific There is about a 20 year lag time between scientific discovery and technical implementation/social discovery and technical implementation/social impactimpact

�� We are currently about 5We are currently about 5--10 years from the next 10 years from the next major shift to biologicallymajor shift to biologically--based technologiesbased technologies


2005

Fuel for Thought:Fuel for Thought:

An Example of OpportunityAn Example of Opportunity


2005

In 2004, how many of us thought

we’d be happy to pay $2.50/gal?

In 2004, how many of us thought In 2004, how many of us thought

wewe’’d be happy to pay $2.50/gal? d be happy to pay $2.50/gal?


2005

How important is domestic energy

to the U.S. national security and

economics?

How important is domestic energy How important is domestic energy

to the U.S. national security and to the U.S. national security and

economics?economics?


2005

CampbellCampbell--LaherrLaherrèèrere World Oil Production Estimates, 1930World Oil Production Estimates, 1930--20502050

Campbell

Production Peak

2004


2005

Annual Production Scenarios for the Mean Resource Estimate and Different Growth Rates (Decline R/P = 10)

0

10

20

30

40

50

60

70

1900 1925 1950 1975 2000 2025 2050 2075 2100 2125

Bil

lio

n B

arr

els

pe

r Y

ea

r

History

Mean

USGS Estimates of Ultimate Recovery Ultimate Recovery Probability BBls-------------------- ---------Low (95 %) 2,248Mean (expected value) 3,003High (5 %) 3,896

DeclineR/P = 10

Note: U.S. volumes were added to the USGS foreign volumes to obtain world totals.

2050 @ 1% Growth

2037 @ 2% Growth

2030 @ 3% Growth


2005

TakeTake--home messageshome messages

�� Petroleum availability will peak in the next Petroleum availability will peak in the next decade or sodecade or so

�� International competition for oil will mean International competition for oil will mean significantly greater costssignificantly greater costs

�� Need to develop secure, domestic, economic Need to develop secure, domestic, economic alternatives (national homeland security alternatives (national homeland security issue)issue)

�� Significant opportunities for renewable, Significant opportunities for renewable, sustainable technology/product developmentsustainable technology/product development

�� Need to gain attention of political/consumer/ Need to gain attention of political/consumer/ industrial audiencesindustrial audiences


2005

How does society change when we donHow does society change when we don’’t t

have cheap petroleum?have cheap petroleum?

�� Reduced, more expensive transportation Reduced, more expensive transportation

–– more localized industries/manufacturingmore localized industries/manufacturing

–– Changes in national energy infrastructureChanges in national energy infrastructure

�� Alternative energy resourcesAlternative energy resources

–– stationary vs. mobile (solid vs. liquid)stationary vs. mobile (solid vs. liquid)

–– coal, nuclear, wind, solar, biologicalcoal, nuclear, wind, solar, biological

�� Alternative raw materials sourcesAlternative raw materials sources

–– renewable resourcesrenewable resources

�� New technologies neededNew technologies needed


2005

Agriculture is TomorrowAgriculture is Tomorrow’’s s

Green GoldGreen GoldChanging view of Changing view of ‘‘AgricultureAgriculture’’�� Extend markets beyond food/feed to industrial productsExtend markets beyond food/feed to industrial products

–– Energy, materials, manufacturing, processing, sensors, medicineEnergy, materials, manufacturing, processing, sensors, medicine

�� ‘‘GreenGreen’’ production/Environmental issuesproduction/Environmental issues

�� New New BioprocessingBioprocessing TechnologiesTechnologies

–– Transgenic modification/productsTransgenic modification/products

–– Processing/manufacturingProcessing/manufacturing

–– Environmental sustainabilityEnvironmental sustainability


2005

Energy, Homeland Security, Energy, Homeland Security,

Integrated Domestic EconomyIntegrated Domestic Economy

Changing view of Changing view of ‘‘IndustryIndustry’’�� Foster Foster ‘‘GreenGreen’’ production production

technologies/Environmental stewardship technologies/Environmental stewardship

Develop domestic renewable energy/materials Develop domestic renewable energy/materials

sourcessources

�� Shift from Shift from ‘‘oldold’’ to to ‘‘newnew’’ technologies to grow the technologies to grow the

economyeconomy

�� ReRe--link U.S. agricultural and industrial sectorslink U.S. agricultural and industrial sectors


2005

U.S. Ethanol ProductionU.S. Ethanol Production

U.S. Capacity U.S. Capacity -- 2.1 billion 2.1 billion

gal/yr (48 plants)gal/yr (48 plants)

Canadian Capacity Canadian Capacity -- 52.3 52.3

million gal/yr (6 plants)million gal/yr (6 plants)


2005


2005

Petroleum fuel Petroleum fuel

consumptionconsumption


2005


2005

Aviation Gas – Turbine Fuels from Renewable Plant Oil

Engine Tests:

• Fuel blends tested in an Allison 250 C-20 turbo-prop gas turbine (stationary)

• Engine performance parameters equivalent to current jet fuels (power and fuel consumption) at operating range from 45% rpm (idle), 50-60% rpm (cruise), and 70% rpm (take – off)

• Decreased NOx and SO2 emissions

•Estimated costs about $3/gallon vs. $3-$5 for commercial aviation fuels


2005

Aviation Deicer/AntiAviation Deicer/Anti--IcersIcers

�� 200 million lb/year market in the US200 million lb/year market in the US

�� Currently based on Currently based on –– 70% propylene glycol formulations70% propylene glycol formulations

–– 30% ethylene and 30% ethylene and diethylenediethylene glycol based productsglycol based products

�� Concerns over mammalian toxicity (EG), Concerns over mammalian toxicity (EG), environmental disposalenvironmental disposal

�� High cost ($5High cost ($5--8/gal) (tied to natural gas prices)8/gal) (tied to natural gas prices)

�� Using glycerin from biodiesel production can make Using glycerin from biodiesel production can make deicers/antideicers/anti--icersicers with equivalent performance to with equivalent performance to commercial products at 1/10 the costcommercial products at 1/10 the cost


2005

Freezing Points

C D E XVII XIX XX XXIV

-40

-30

-20

-10

0

FP

(oC

)

FP < -38 oC

Anti-Icer Limit

Deicer Limit

Purdue University School of Aeronautics and Astronautics


2005

Biosurfactants from Lipids and Carbohydrates

1000x more surface active than sodium lauryl sulfates


2005

BioBio--based Products/Technologiesbased Products/Technologies

�� Automotive biodiesel fuel, home heating Automotive biodiesel fuel, home heating

oiloil

�� Polyurethane plastics, insulation foamsPolyurethane plastics, insulation foams

�� Inks, paints, coatingsInks, paints, coatings

�� Surfactants, detergentsSurfactants, detergents

�� Polymers, solvents, lubricantsPolymers, solvents, lubricants


2005

Transgenic PostTransgenic Post--synthetic synthetic

Lipid Lipid in vivoin vivo ModificationModification


2005

How Do We Get Oils From Plants?How Do We Get Oils From Plants?

Grow Plants

Plants Store OilIn Seeds

Grow Plants

Harvest& ProcessPlants

ChemicallyModify Oils

Plants Store &Modify OilsIn Seeds

Harvest& ProcessPlants

Current Approach :

• Low yields and high purification costs• Byproduct generation and hazardous solvents• High energy input

Proposed Approach:

• Enzymes to catalyze reactions (but enzymes can be slow)• Production within the plant to reduce processing costs


2005

Soybean Oleosin ProteinsSoybean Oleosin Proteins

�� Soy oleosins are a group Soy oleosins are a group of closely related soy oil of closely related soy oil body membrane body membrane structure proteinsstructure proteins

�� Soy oil bodies Soy oil bodies –– SubcellularSubcellular

triacylglyceridestriacylglycerides (TAGs) (TAGs) storage particlesstorage particles

–– TAG coreTAG core

–– Monolayer phospholipids Monolayer phospholipids

–– Oleosin protein coatingOleosin protein coatingOil Body 3-D Structure


2005

in vivoin vivo micromicro--bioreactor conceptbioreactor concept

using enzymatic reactionsusing enzymatic reactions

TAG

Phospholipid

Oleosin

Enzyme

Create an oleosin-enzyme

Fusion protein in vivo

Create an Create an oleosinoleosin--enzyme enzyme

Fusion protein Fusion protein in vivoin vivo


2005

Isolate immature zygotic soybean embryo tissue

Bombard tissue with recombinant genetic material Grow out and select living tissue cells

Use GFP/Antibody/PCR to detect transforrmed tissueGrow out to proliferative embryos

Germinate embryos andgrow recombinant plants


2005

Creating New Life FormsCreating New Life FormsCreating New Life Forms�Cloning pets - warm & fuzzy

�Potential economic benefits

�Alteration of definition of life

�Behavioral genetic issues

��Cloning pets Cloning pets -- warm & fuzzywarm & fuzzy

��Potential economic benefitsPotential economic benefits

��Alteration of definition of lifeAlteration of definition of life

��Behavioral genetic issuesBehavioral genetic issues

��Alba, the GFP Alba, the GFP bunny bunny –– chimerical chimerical animal that does not animal that does not exist in natureexist in nature


2005

Human ResourcesChampions for Biological Engineering

Human ResourcesHuman Resources

Champions for Biological EngineeringChampions for Biological Engineering


2005

Home heating fuel

Entrepreneurial undergraduate Entrepreneurial undergraduate

soybean product innovation soybean product innovation

UV curable plastic

Snow ski wax

Crayons

Emulsionmarkers

Gelatin replacements Protein snack crackers Birthday candles


2005

The Soybean Science KitThe Soybean Science Kit

KK--1212

�� The Soybean Science Kit (SSK) teaches basic chemistry and The Soybean Science Kit (SSK) teaches basic chemistry and physics in a fun, safe, handsphysics in a fun, safe, hands--on fashion using primarily on fashion using primarily materials obtained from soybeans and other natural renewable materials obtained from soybeans and other natural renewable materials. materials.

�� Teaches students about the importance of environmental issues, Teaches students about the importance of environmental issues, science, technology and industrial applicationsscience, technology and industrial applications

�� Polymers, proteins, fatty acids, chromatography, enzymes, DNA, Polymers, proteins, fatty acids, chromatography, enzymes, DNA, biodiesel and more biodiesel and more

�� Developed by the Indiana Soybean Board, over 3000 kits Developed by the Indiana Soybean Board, over 3000 kits distributed distributed

�� Approval by State Education CommissionApproval by State Education Commission

�� Reaches est. 60,000 students annually (as well as their Reaches est. 60,000 students annually (as well as their teachers, parents and siblings)teachers, parents and siblings)


2005

Teaching Ethics Teaching Ethics

to Studentsto Students

�� Ethics is about choices in behavior Ethics is about choices in behavior

while in relationships/community while in relationships/community

with otherswith others

�� Biotechnology/Agriculture will play Biotechnology/Agriculture will play

a dominant role in society in this a dominant role in society in this

centurycentury

�� With power comes responsibility, With power comes responsibility,

and you will have great power as a and you will have great power as a

Ag school graduateAg school graduate

�� How will you choose to live?How will you choose to live?


2005

Who Moved My Who Moved My

Cheese?:Cheese?:

Issues for the Issues for the

Agricultural Agricultural

Community/IndustryCommunity/Industry

How does Agriculture Fit in?How does Agriculture Fit in?

� How should ‘Agriculture’ re-think its purpose, function, and goals in a bioeconomy?

�What should its role be based on new biotechnologies?

�How can Agriculture benefit economically from these changes in technology?

�� How should How should ‘‘AgricultureAgriculture’’ rere--think its think its purpose, function, and goals in a purpose, function, and goals in a bioeconomybioeconomy??

��What should its role be based on new What should its role be based on new biotechnologies?biotechnologies?

��How can Agriculture benefit economically How can Agriculture benefit economically from these changes in technology?from these changes in technology?


2005

automotiveautomotiveautomotive

plasticsplasticsplastics

fabricsfabricsfabrics

paints, coatings

paints, paints, coatingscoatings

cosmeticscosmeticscosmetics

detergentsdetergentsdetergents packagingpackagingpackaging

PETROLEUMPETROLEUM

electronicselectronicselectronics

Materials: Polymers, coatings, detergents,fabricsMaterials: Polymers, coatings, Materials: Polymers, coatings, detergents,fabricsdetergents,fabrics

AGRICULTUREAGRICULTURE


2005

fuelsfuels

chemicalschemicals

plasticsplastics

coatingscoatings

energyenergy

petroleumpetroleum

19501950--2020 2020 U.S. U.S. Economy/Economy/

Core Core Processing Processing Technologies Technologies based on based on petroleum petroleum refining/off refining/off shore sourcesshore sources

fuelsfuels

chemicalschemicals

plasticsplastics

coatingscoatings

energyenergy

20202020--21002100

Core Core Processing Processing Technologies Technologies based on based on distributed distributed technologies/technologies/geographical geographical sourcessources

biomassbiomass

solar/wind/solar/wind/waterwater

Fuel cellsFuel cells

biotechbiotech

nanotechnanotech

� Opportunities to develop replacements for petroleum in chemicals, fuels, polymers, surfactants, coatings

� Opportunities for Agriculture to become main supplier of raw materials (domestic security/inherent advantages)

� Opportunities for liquid energy fuels

�� Opportunities to develop replacements for petroleum in Opportunities to develop replacements for petroleum in chemicals, fuels, polymers, surfactants, coatings chemicals, fuels, polymers, surfactants, coatings

�� Opportunities for Agriculture to become main supplier of raw Opportunities for Agriculture to become main supplier of raw materials (domestic security/inherent advantages)materials (domestic security/inherent advantages)

�� Opportunities for liquid energy fuelsOpportunities for liquid energy fuels

Shift from single to distributed technologies/geographical sourcesShift from single to distributed Shift from single to distributed technologies/geographical sourcestechnologies/geographical sources


2005

Shift to regional energy technologies (?)Shift to regional energy technologies (?)

Solar, biomass, hydroelectric, coal, fuel cell, Solar, biomass, hydroelectric, coal, fuel cell,

LNG, hydrogen(?)LNG, hydrogen(?)

Common electricity grid/power distributionCommon electricity grid/power distribution

Common mobile liquid fuel Common mobile liquid fuel

technologies/geographical distribution (?)technologies/geographical distribution (?)

Competitive global economics/technologies (?)Competitive global economics/technologies (?)

Shift from single to distributed technologies/geographical sourcesShift from single to distributed Shift from single to distributed technologies/geographical sourcestechnologies/geographical sources


2005

Opportunities for Rural Economic Opportunities for Rural Economic

Growth/Growth/BiorefineriesBiorefineries

�� Vertical product/market integrationVertical product/market integration

�� ReRe--capitalization of rural economy to capitalization of rural economy to

encompass biorefinery conceptencompass biorefinery concept

�� PartnershipsPartnerships


2005

Vertical product/market Vertical product/market

integrationintegration

�� Make products for consumer/industry, Make products for consumer/industry, not only high volume/low price not only high volume/low price commodity commodity feedstocksfeedstocks–– Fuels, protein polymers, antifreeze, etc.Fuels, protein polymers, antifreeze, etc.

–– Example of petrochemical industries Example of petrochemical industries starting with drilling and integrating starting with drilling and integrating through fuels, chemicals, polymers, paintsthrough fuels, chemicals, polymers, paints

�� Higher profit margins, decrease $ Higher profit margins, decrease $ outflow by internal utilization/recyclingoutflow by internal utilization/recycling


2005

ReRe--capitalization of rural economy to capitalization of rural economy to

encompass biorefinery processing conceptencompass biorefinery processing concept

�� Expand operational knowledge of Expand operational knowledge of

biotechnology and postbiotechnology and post--harvest harvest

technologiestechnologies

�� Develop expertise/ownership of postDevelop expertise/ownership of post--

production/harvest technologiesproduction/harvest technologies

�� Capitalization of integrated biorefinery Capitalization of integrated biorefinery

processing systemsprocessing systems


2005

PartnershipsPartnerships

�� Strengthen relationships with existing support Strengthen relationships with existing support infrastructureinfrastructure–– universities, food processors, industrial grain universities, food processors, industrial grain processors, COprocessors, CO--OpsOps

�� Expand outreach to form relationships with Expand outreach to form relationships with nonnon--traditional entitiestraditional entities–– Chemical eng., life sciences, petroleum refiners, Chemical eng., life sciences, petroleum refiners, chemical synthesis companieschemical synthesis companies

�� Unify agricultural industry to form a strong, Unify agricultural industry to form a strong, corporate entitycorporate entity–– Supply chain strongest linkSupply chain strongest link


2005

Big Fish Eat Small FishBig Fish Eat Small Fish

Issues involving scale of Issues involving scale of demand/supply operationsdemand/supply operations

�� Small fishSmall fish

–– Individual farmers, small Individual farmers, small COOPCOOP’’ss

�� Medium fishMedium fish

–– ADM, Cargill, ADM, Cargill, BungeBunge

�� Big fishBig fish

–– MobileMobile--Exxon, BP, Dow, Exxon, BP, Dow, DuPont/DuPont/SolaeSolae


2005

Small Fish Can Dominate Big FishSmall Fish Can Dominate Big Fish

�� Strength in numbersStrength in numbers

�� CoordinationCoordination

�� Unity of PurposeUnity of Purpose

�� Ownership of Supply ChainsOwnership of Supply Chains


2005

TakeTake--Home PointsHome Points











??""Chance favors the prepared mind.Chance favors the prepared mind.””

-- L. PasteurL. Pasteur

Where your treasure is, there will your heart Where your treasure is, there will your heart be also. be also. –– Matt. 6:21Matt. 6:21

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