Agricultural economics is a topic that has been studied for many years. Often times, the effect that organic agriculture has on the economy is overlooked. However, it is incredibly important to understand the trends of organic agriculture and how it relates to the economy. Researching and identifying hotspots have proven to be advantageous for economic development. While it seems that organic agriculture is less efficient and requires more money than conventional agriculture, it has been determined that organic agriculture's benefits greatly outweigh its cons. In 2012 the sales of organic goods increased from $11 billion to $27 billion. This increase in sales also means an increase in demand making the identification of organic hotspots even more important.
Organic operations are different from conventional agriculture operations.
Organic operations must meet certain standards:
Crop Standards:
No prohibited substances applied to the land for at least 3 years before harvesting an organic crop
Pests and weeds should be controlled through physical, mechanical, and biological control methods. Only synthetic substances that are approved can be used to control pests and weeds.
Organic seeds must be used.
Genetic engineering, ionizing radiation, and sewage sludge are prohibited.
Livestock and Poultry Standards:
Animals that are being slaughtered should be raised using organic management.
Livestock must be fed products that are 100% organic.
All dairy animals must be handled organically for 1 year.
Producers cannot withhold treatment from a sick animal. An animal that has been treated with a prohibited substance cannot be sold as organic.
Animals must receive at least 30% of their feed from the pasture.
All organic livestock must have access to the outdoors year round.
Handling Standards:
In a product labeled as 'organic' all ingredients must be organically produced.
Commingling of organic and non-organic products must be prevented.
An organic hotspot is defined as an area of land at the county level that has a high number or organic operations and has neighbors with a high number of organic operations. An organic coldspot is defined as an area of land at the county level that has a low number of organic operations while having neighbors with a high number of organic operations. Organic hotspots and cold spots are not determined by value of sales or value of revenue from the county. These areas are determined using Local Moran's I Statistic. This statistic test the null hypothesis that there is no spatial correlation between geographic neighbors. If there is a high positive correlation with neighbors and they have high levels of organic activity then it is considered an organic hotspot. If there is a low level of organic activity and a positive correlation with neighbors it is considered an organic coldspot.
Agriculture is a highly spatial industry meaning that there are a wide variety of geographical and economical factors. Identifying these hotspots can help the public understand the importance of organic agriculture:
Leads to economic development for the county
Organic industry is growing faster than the conventional food industry so there is a need for government policies and an understanding of the supply and demand
Understanding and visualizing how these organic hotspots and coldspots are and how they change over time will allow for a better understanding of the industry.