The 2024 Holmberg Address: Transcript of remarks by 2024 Laureate Thomas J. Vilsack, US Secretary of Agriculture

You know, there’s always a bit of melancholy associated with receiving a lifetime achievement award sort of suggests that you might be at the end of the road. But I don’t feel that way.

And I’m honored to be back speaking to you today. This is I think, my fourth opportunity to speak to this group and I always look forward to it, because of the growing significance of this industry. What you’ve done is you’ve made it relevant in so many areas that are important to this country. It’s relevant in healthcare. It’s relevant and energy. It’s relevant in climate. And it’s certainly relevant in food security, all of which we deal with today, in this country, it’s a huge industry. You’ve grown it now to a $464 billion industry that contributes every single year to the economy of this country in every single state. 

A predecessor of mine, Bob Bergland, as he was leaving the office of the secretary of agriculture in 1981, raised concerns about the agricultural policy of the country and its impact on the number of farms and its impact on rural communities. He was concerned that there might indeed be a shrinking of farm numbers, and that that would have a negative impact on rural places in rural people. Well, I recently read his report, and I then did some follow up with our team. And I asked how many farms in fact, have we lost since 1981. And it turns out, it’s 544,000 Farms. We’ve also lost 155 million acres of land that was in farming, but is no longer in farming. Now. That’s the landmass of Florida, Georgia, South Carolina, North Carolina, Maryland, and a good part of Virginia. And the impact that has had on rural communities has been over time a shrinkage of population and poor conditions.

And that’s why it’s important for us to begin asking the question of whether or not we as a country are okay with that trend? Are we okay with the notion that the only option in agriculture and in rural places is you just got to get bigger and bigger. And that would be fine if everybody had a shot at getting bigger. But the reality is that the income is also heavily concentrated. The largest farms, those who sell more than a half a million dollars in sales over the last five years, have generated about 85% of the income, they represent only 7% of the farms. So the other 93% of farms have to share 15% or so of the income which makes it really difficult.

That’s why it was important for us in this administration to take a look at ways in which we could expand the number of income streams coming into farms today. 88% of our farmers have to work an off farm job to be able to keep the farm. So we need to ask the question, why is it that the farmer has to work two jobs? Why can’t the farm create multiple sources of income, in addition to the sale of crops, that’s where you folks come in. Because you’re creating a tremendous opportunity for additional income streams. You know, we’re looking at ways in which through biofuels, sustainable aviation fuel, bio chemicals and fertilizers, and biomaterials that you can create a market for agricultural waste product that today may not have much value of any, or may actually create some serious issues on the farm and in the community.

I think the President understood the significance of your industry when he executed an executive order 14081 in which he basically said, look, the history and future of this country is dependent on us continuing to be innovators in biotechnology and the biotechnology industry is in fact going to be a driver of that future. It’s going to allow us as a country to create more resilient food supply chains, more resilient energy supply chains, it’s going to help solve serious health care challenges, it’s going to make sure that we are addressing aggressively the risk of climate and mitigating that risk. And as a result, it’s going to be important for us to have adequate supply chains and strengthened supply chains in order to be able to make sure that that future is a reality here in this country. So he directed the Department of Agriculture in that executive order to issue a plan to take a look at will we have sufficient biomass to basically support the innovation that you all are coming up with. So today, we’re issuing that biomass plan. It’s a comprehensive analysis that we’ve done of of the supply chain and the existence of biomass in this country. It reaches a number of I think critical conclusions, which is today we have an adequate supply of biomass to meet the needs as you are creating more demand…To do that, and to encourage farmers to be participants and producers of this biomass, it’s going to be really important that we synchronize the market development and the creation of markets. The report, I think, underscores the significance of the work we’re attempting to do right now.

We also are working not just on the farming and ranching side of the house. But we also, as you may know, run the Forest Service. Now I say that tongue in cheek because when I got this job the first time,

My son called me and said, Hey, Dad, you know, you got the Forest Service under the purview of USDA and I said, I have what? Most people think that the Forest Service is in the Interior Department. No, it’s it’s in it’s in the ag department because it is a commodity. And it’s going to become a more increasingly significant commodity as we make an effort investing infrastructure, money and inflation reduction money and reducing the risk of wildfire. We’re creating a substantial amount of woody biomass. And the question is, what do you do with all of that, which is why we’re investing significant resources in. And I’ll talk about this in a second in innovation in this space, so that we create new bio products from this hazardous fuel material that we’re reducing from forests, reducing the risk of catastrophic wildfire, protecting communities, creating a new income source for those who own forested lands, and also providing you all with feedstock to produce these amazing new products.

Now there in this report, we basically make some key findings and establish some key factors and make recommendations obviously. And one of the recommendations is to continue to look for ways in which we can improve the collection and processing of waste material. It’s all well and good to produce the biomass. But the reality is, even as we produce it, there’s going to be waste. And we’re very interested in supporting the circular economy notion. We’re there as is in nature, there is no waste, everything has value. Everything has a purpose. So we want to improve the collection and processing of waste. We want to optimize the efficiencies and growing the supply of sustainable lipids. We want to improve logistics. And certainly we’re going to have support and doing that. Because right now the infrastructure law is now in full force. Over 45,000 infrastructure projects are under construction underway under design right now. So you’re going to see improved transportation systems in this country, which is about time. And it’s going to allow us to retain and I think get back the competitive edge we had around the world in terms of our ability to move finished product from here to there, more inexpensively and more efficiently resulting in us being competitive, not just domestically, but also from an export market perspective. And I think we obviously are recommending that we need to continue to look at ways in which we can grow markets.

In the past, what we do with these reports is we do what I just did, which is we announced the report. And you all scurry to the internet. And you look at the report and you read the report and and you take guidance from it.  But what are we going to do at USDA? So for the first time, perhaps ever, following a report, there is also an additional document that we’re filing today, which is our implementation plan. So we’re telling the world kind of what we want to do. And we’re we’re focused over the next 12 months. And that focus is obviously increasing the availability of the biomass, continuing to use our resources at USDA to invest in the infrastructure, and then look for ways in addition to climate smart commodities to support market development, and supply chains, and provide technical assistance to folks who are interested in creating new products. Now, this isn’t a new idea for us, we’ve been pretty much engaged in this for for some time, let me give you a few examples. We’ve invested just in the last 12 months $152 million in loans and grants to expand the availability of advanced biofuels and infrastructure for biofuels, we’ve invested in expanding access, so consumers have more choice at the pump, and lower cost gas as a result, we’ve invested in renewable fertilizer production. This is always interesting to see what you all do, in this space, the conversion of egg waste and chicken manure, the use of

powdered spent lime. It’s an amazing new world, and you’re a part of it, you’re a driving part of it.

We also recognize the importance of research and development, which is why we’ve invested nearly $500 million in a variety of challenges, including our bio product pilot program, where we took infrastructure money, and we’re using soil to to produce rubber. It’s also an interesting climate smart commodity program in Arizona, where they are basically taking one of the desert plants and producing natural rubber from it. We don’t produce rubber in this country, but the Defense Department is quite interested in us being able to do it and so are the cars that run in Indianapolis every day. And as a result, they’re investing in this project of producing rubber from these desert plants. We’re taking swine manure, and we’re converting it into a asphalt product that will reduce the cost of repairing county roads. We’re using food waste, to produce new plastic products, all of which will obviously reduce landfills and the methane that those landfills produce all because of the work that you all and folks like you are doing. I mentioned the Forest Service. We’ve also invested $72 million in the last year or so. And 160 projects, looking at how we might be able to utilize woody biomass more effectively, everything from biochar, to nano site, elastic materials to mass timber, to industrial mats and much, much more. And we’ve also engaged our foreign ag service and expressing the need for them to be engaged in this process as well as in terms of spreading the message about the opportunity for exports of biotechnology and of bio products. All of this is taking place at a time when we’re excited about the future. And it’s interesting that the last panel as I came in was talking about sustainable aviation fuel.

USDA has been a partner with the Department of Energy and Department of Transportation in challenging us and challenging all of you and challenging industry to get to 3 billion gallons by 2030 and 36 billion gallons by 2050. Our sweet spot, and that challenge is working on establishing appropriate feedstocks, and talking about the supply chain logistics, and how they may be improved. In order to advance this very significant new industry, the reality is we’re not going to have battery-powered planes for a while, we’re not going to have hydrogen-powered planes for a while. So we do need a low carbon burning fuel. Lanza jet, as everyone knows, celebrated the opening of the first commercial plant happened had the privilege of being there when they opened that plant. That’s the beginning. We have invested in in the GMO effort up in Minnesota in the northwest, as they work with farmers and ranchers and producers and ethanol, and mentioned was made of the various tax credits.

And I know that everybody expected and so that we that we’ve tried to meet that March 1 deadline for the guidance from the Treasury Department. [Yet] in this effort of providing guidance, we want to make sure we got it right. Frankly, there’s some education that is required. The first benefit of that was making sure that as modeling was selected for purposes of determining who gets the credit and how you calculated and how you determine whether or not what’s being produced has a more advantage than domestic, currently available fuel supplies. We suggested that the GREET model was in fact a model that could provide good guidance and good direction, it took a little bit of convincing to make that happen. But we did we got it, we got Treasury to understand and appreciate it was important to have that model. And now we’re in the process of making sure that everyone understands and appreciates the work that is being done with cover crops with no till with energy efficient fertilizer out in the countryside, and that there are verifiable and measurable results coming from those practices.

You know, I’m convinced at the end of the day, there’s going to be a significant range of opportunities available in terms of feedstocks, because there has to be. And the reason there has to be is because if there isn’t, then we’re confronted with a circumstance of this great new industry starting in the United States, with United States leadership being dependent on imported feedstocks. I just don’t see that as being feasible. I don’t think we can accept that. And that’s the case I’m making.  We have a responsibility to our producers, to our companies, to our businesses to make sure that whatever we do with this emerging new industry, we do it here in the US. And because it’s important, not only for the obvious reasons, but it’s also important in terms of being able to continue to establish American leadership.

You know, I just don’t know that Americans have fully grasped what’s happening in the country today. For far too long, we have been, I think, comfortable with the nature of our economy. For many, many years, it was the strongest and most relevant country in the world, in terms of the economy. For many years, we were we were the innovators. And then we just got comfortable. All of a sudden, a lot of nations around the world, copying what we did, seeing what we did, understanding the significance of science and research and technology and innovation, began to invest and began to challenge their young people to think up new ideas and new products in new ways.

Over time, the world became far more competitive. Well, the one thing I know about all of us is at the end of the day, we are a competitive lot. And I think we finally awakened up to the fact that there’s a competition going on here. There can only be one winner, and that’s us. That’s why it was important, not only to emerge from the pandemic, to get things back on track, but to invest in that future, to recognize that our infrastructure had been for far too long ignored, to recognize that we needed to invest in innovation, that we needed to put serious resources behind this effort, which is what the Inflation Reduction Act is doing, that we need to be the premier leader of this new clean economy, which puts all of you right in the center of that opportunity, because that’s what you are all about. With these investments, with this infrastructure, we are poised to emerge, as again, the world leader in biotechnology, the world leader in healthcare innovation, the world leader, in clean energy, the world leader in food security,

the world leader in addressing the challenge that climate presents to us and how we might mitigate the consequences.

So we should accept the challenge, understand that there are serious resources committed to this, and be excited about that future. And I think sustainable aviation fuel is the poster child, if you will, for this new clean economy. So I’m extraordinarily excited about this.

Let me finish by taking this one step up. Why it’s important to all of us. Because if you can create this new economy, that depends in large part on the development of biomass, which by its very nature is going to come out for the most part from rural places, and in doing so you create processing and manufacturing, and conversion of that biomass into something more valuable, the likelihood is that much of that is going to be done in rural places.

So you’re creating the additional opportunity, additional revenue streams, for farmers and ranchers and producers to be as creative and innovative along with you. You can create manufacturing and processing jobs in rural places. And you can begin the process of rebuilding and revitalizing the rural economy. Now, I think that’s beginning just very, very small steps, but significant steps. When you look at the recent trends in rural places, such as unemployment now, unemployment now at pre pandemic levels, unemployment at historic low, persistent poverty for the first time also being reduced. This is poverty where counties had been dealing with 20% or more of poverty, the poverty rate for over 30 years. 55 counties are no longer in that category. Out of roughly 260, a few counties were added to the category but we had a net of 29 reduction. First time we’ve seen that in a while. And first time in a while we’ve seen people coming back to and living in and wanting to be in rural places.

Now, why is that important? Because if you create revenue streams, you create opportunities for small and midsize producers, to stay in business and to do what every farmer I know wants to do, which is to turn to their son or daughter or grandchild and say, You know what you can do this, you can continue, you can be the next generation, the third, the fourth, the fifth, the sixth generation, and proudly do so and make a living. You’re gonna have your kids stay in the school. So the rural school can stay healthy. There’ll be more folks living in those rural communities so that small business in the downtown area can stay open. You don’t have to depend on a Dollar store or a Walmart. Your hospital can actually attract a doctor because you have enough people to support a hospital.

Most important of all, you expose all of those people in that community to the value system that surrounds that community. A value system that understands that you can’t keep taking something that value you have to give something back to it. farmers understand this. It’s intuitive. You can’t keep taking from the soil. You can’t keep planting a crop and just hoping that something comes up every year, you got to replenish it, you got to re-nourish it. And people who grow up in those communities understand and appreciate. It’s not just the soil, it’s also the country, that gives us so much that requires us to give back to it. 

And that’s why you see a disproportionate number of young people from those communities going into the military and volunteer service. If we want to keep that ethic alive, if we want to continue to have a broad array of young people participating in supporting and defending our country, the work you’re doing is central to it. Whether you think it is most important to reduce the cost of health care in this country, or you think it’s really important to do what needs to be done to mitigate climate change, are you think it’s really important that the America continues to feed the world or you think it’s significant that we have a leadership in driving the world economy.  It’s important that that value system be preserved

Understand that the work you do here, the conversations you’re having, have a much, much more profound impact on this great country than you might realize. And I hope that that gets you up every morning.

Because that’s what gets me up every morning.