Introduction to Agriculture

Definition of Agriculture

• Agriculture originates from the Latin word "Agricultura," meaning cultivation of land
• It involves cultivating soil, producing crops, and raising livestock
• Agriculture is the world's basic food and fibre producing industry
• It includes traditional farming and intensive livestock/crop production
• Agriculture covers commodity development, manufacturing, and distribution i.e; animal feed, crop seeds, fertilizers, agricultural chemicals, veterinary products, and machinery
• It involves the processing and marketing of livestock
• Agriculture is cultivating or producing crops from soil and rearing livestock
• Some crops are produced without soil, like in hydroponics farming systems, where plants grow in water with chemical nutrients
• Agriculture is among the oldest technologies, predated by primitive food gathering, hunting, and fishing

Modern Agriculture Problems

• Man's greed, ecological irresponsibility, and lavish lifestyles pose key problems
• Problems exist in feeding and clothing the global population
• Disturbances to the ecosystem and a lack of compassion limit sustainable practices
• A sustainable lifestyle includes care for technology

Agriculture's Role in PNG's Economy

• Agriculture is a top development priority in PNG, supporting the mineral sector
• It is a key renewable resource sustaining over 85% of PNG's population (8 million plus)
• Foundation of the rural economy, practiced for about 10,000 years
• People in villages understand subsistence farming best
• Training is needed to produce crops and animals in greater quantities and superior quality for commercial use

Economic Significance

• Significant contributor to the economic prosperity of developed countries
• Equally important in the economic development of less developed countries, especially where per capita real income is low
• Agriculture and primary industries are emphasized
• Increase in agricultural production along with industrialization and urbanization increases demand in industrial production
• Agricultural Revolution preceded the Industrial Revolution in Great Britain, the USA and Japan
• Industrial and agricultural developments are complementary and mutually supportive

PNG's Economy

• Agriculture sustains 85-87% of people, who rely on traditional subsistence systems for food
• It is a form of renewable resource
• Agriculture provides useful socio-economic and political roles for all nations
• Countries trade agricultural produce to satisfy demands
• Many countries rely on agricultural exports for foreign exchange earnings

International Trade

• Enables nations to economically produce within their climates
• Agriculture, including forestry and fisheries, provided 30-40% of PNG's GDP over three decades
• Palm oil, coffee, and cocoa exports comprised 85-87% of agricultural export revenue since 2000
• In 1998-2001, agriculture, forestry, and fishery contributed 30% to total exports in contrast to mining, oil, and gas at over 70%
• Foreign exchange earned is used to import goods
• In 2011-2013, agriculture contributed K3.79 billion to a total revenue of K16.37 billion
• Agriculture contributed K2.69 billion in 2012 to a total of K13.17 billion
• Agriculture contributed K2.66 billion in 2013 to a total of K12.51 billion

Comparative Advantage

• International trade allows countries to trade based on comparative advantage or resource endowment
• Products can be efficiently, cheaply, and qualitatively produced with climatic/soil conditions, labor
• Countries import products they cannot produce and lack the resources for
• Agriculture is the only sector of the PNG economy with a comparative advantage
• Mineral and gas resources create national wealth in the short term
• Agriculture is sustainable in the long term

Jobs and Income

• Agriculture sustains 85-87% of PNG's population, mainly rural citizens
• Subsistence producers sell surplus crops to buy necessities, like rice, canned fish, sugar, salt, clothes, education, and health services
• Smallholder agriculture with oil palm, coffee, and cocoa blocks provides employment and cash, meeting livelihood needs
• Cash crops prevent antisocial behavior and promote life-sustaining activities
• PNG's coffee industry employs about 3 million people, including 400,000 smallholders: middlemen, roadside buyers, exporters, processors, factory workers, and transport workers
• Agriculture also employs production engineers, agricultural scientists, food technologists, chemists, biologists, economists, accountants, IT specialists, and boiler makers
• Jobs are available in retail/wholesale marketing, production, and supplying seeds, agrochemicals, farming tools, and machinery
• PNG's annual population growth rate has been 2.3%-2.7% since 1990, declining slightly
• Over 80,000 youths (ages 15-24) enter the labor market each year
• Few jobs lead to high unemployment
• Freeing up customary land can create more agricultural industries for more employment

Raw Materials

• Agriculture provides raw materials for worldwide industries
• Raw materials can be produced, exported, and used in industries in distant countries
• Cocoa from PNG is exported to Australia/Europe to become chocolate, cocoa butter, biscuits, and drinks
• Agriculture supplies raw materials for agro-based industries
• Several agricultural products are directly used by consumers, such as fresh fruits, nuts, and tuber crops
• Most agricultural raw materials need processing before consumption
• Processing ensures quality and increases product quantities adding value
• Raw material production offers employment, cash income for small producers, and foreign exchange

Poverty Alleviation

• 85-87% of people in PNG are sustained by subsistence agriculture
• Only 15% of Papua New Guineans are employed in the formal economy in urban/mining areas
• 85-87% are in the informal economy, mostly in rural and urban areas
• 85-87% of the rural population live in absolute poverty, solely dependent on agriculture
• PNG's Human Development Index (HDI) increased from 0.432 to 0.541
• PNG ranks 148th out of 182 countries, trailing most countries
• PNG was ranked worst in the Asia-Pacific Region after Timor-Leste and Afghanistan
• Poverty incidence is lower among wage-employed, private business owners, and smallholder commercial crop producers vs. unemployed in subsistence agriculture
• Agriculture can provide employment, reduce poverty, and improve life quality if the needed ingredients come into play
• Studies showed that 82% of the rural population earn less than K150.00 per capita annually, 12% earn between K151 and K300
• Uneven distribution of cash, rural people have low disposable income and purchasing power
• Smallholder agriculture has improved livelihoods
• A study by the Asian Development Bank found that 90% of 150,000 households in cocoa production are smallholder farmers, and only 10% are from estates
• People earn good income from cash crops

Food Security

• Agriculture provides 83% of the nation’s food energy and 76% protein
• Remaining food groups are imported
• PNG cultivates a wide variety of food crops, including banana, coconut, sweet potato, taro, yam, cassava, and sago
• PNG depends heavily on agriculture for food, employment, and income
• Agriculture ensures food security
• National food security is generally good in terms of quantity
• A high proportion of farmers (over 90%) are semi-subsistence, produce crops/livestock for consumption, and sell surplus for income
• People can access land, cash income to buy food when subsistence is low
• Nutritional deficiencies exist due to problems accessing adequate and varied food
• People rely on subsistence agriculture and traditional survival skills when government food assistance is delayed during natural calamities

Poor Performance Factors

• Reduced world market prices for tree crops (coffee, cocoa, copra, palm oil) is a major cause
• Low productivity of the smallholder production system
• Poor product quality
• High production costs (labor, transport, processing costs) limit access to markets
• Costly marketing systems and market information
• Poor infrastructure

Agricultural Sector Constraints

• Lack of practical research targeting subsistence agriculture and traditional systems
• Inadequate support services (extension and marketing)
• Insufficient skilled human resources
• High freight costs due to inadequate transport and bad roads
• Lack of support for mobilizing traditional land for commercial agriculture
• Limited credit access for commercial agriculture and rural development
• Low private investment in rural development
• Lack of government commitment, leading to poor GDP growth (1%) compared to population growth (2.3%)