THE AGRICULTURAL INDUSTRY IN ALASKA
A 10-Year Look at a Changing Resource Industry
Carol E. Lewis, Dean and Director
Professor of Resources Management
School of Agriculture
and Land Resources Management
Agricultural and Forestry Experiment Station
University of Alaska
The agricultural industry that flourished in Alaska in the late 19th and early 20th century grew out of necessity related to frontier expansion. Expansion
was encouraged throughout the United States and its territories by a positive federal policy for agricultural development.
Alaska’s agricultural industry stagnated in the 1950s when transportation into the territory made it more efficient
to import food products, both fresh and processed. When interest in agriculture was renewed in the late 1970s, the United
States was well into the post-industrial, non-expansionist period and its policy did not favor increasing agricultural lands
in production. As a result, there was virtually no federal support for expanding the agricultural industry in the state.
There was ‘grass roots’ support for expansion of the agricultural
industry in Alaska in the 1970s. The state’s economy was expanding because of increasing oil revenues. The non-indigenous
component of the population had migrated from the contiguous states where agriculture signified a solid economic base and
epitomized the frontier spirit. However, at the decision making level, there was little understanding of the industry. Certainly
there was nostalgia for the pastoral farm landscape, but it was not understood that a commodity-based agriculture is a low-margin
industry that develops over a long period of time. Only recently have higher margins been realized as agricultural entrepreneurs
move into non-food and diversified new food and fiber production. Another misunderstanding held by Alaskan decision makers
was and is that a traditional and a new agricultural industry require an infrastructure that includes transportation, processing,
research, and outreach and aggressive marketing. The administration in power in Alaska in the mid 1970s and early 1980s provided
support for expansion of the agricultural industry in the form of land sales, loan programs, and partial infrastructure. Its
rational was based on nostalgia and only partial understanding of the infrastructure necessary to promote expansion. Following
administrations failed to understand the continuing long-term support necessary to sustain the industry. As a result, state
support for the agricultural industry in Alaska is minimal1.
Federal policy toward agriculture, simplistically, reflects the maturation
and internationalization of an economy. Alaska policy toward agriculture reflects the misunderstanding of the characteristics
of a diversified agricultural industry and the historical ‘boom-bust’ economic history of the state and territory
that chases immediate profit rather than long-term stability2.
The result of policy decisions at the federal and state level is minimal support
for Alaskan agriculture. Specifically, this support is not present for critical infrastructure elements such as transportation,
financing, support programs, research, and outreach. The combination of public investment in these critical elements and the
subsequent reduction of risk that induced private sector investment was responsible for the development of U.S. agriculture
and the continuing success of the agricultural industry in the United States today. This is not the case in Alaska.
Today Alaskan agriculture supplies approximately 10% of the state’s
food needs. All traditional agricultural products constitute less than one percent of the state’s revenues from resource
industries3Alaska’s agriculture is a closed agriculture. There is no infrastructure to export bulk goods such as small
grains and potatoes. Processing is minimal for red meat, milk and vegetables. The population base of 625,000 limits the in-state
market. The lack of infrastructure to move product within the state further hinders producers of bulk products.
Despite impediments, Alaska’s agricultural producers continue to look
to the future. The baseline statistics for a traditional industry are available through the Alaska Agricultural Statistics
Service (1953 through present). They indicate that the industry continues to grow. This historical overview of the agricultural
industry in Alaska uses these statistics and concentrates on the 10-year growth period from 1992 to 2001. The agricultural
industry in Alaska is changing and expanding. It is becoming a part of new directions for agriculture in the United States
– new products, diversification, and new markets.
Agriculture in Alaska had its beginnings earlier than is recognized by most.
Production of food was a primary concern in selecting sites for Russian trading posts in southern coastal areas. As the Russians
learned in the early 1800s, climate and soils in these areas are limiting. This is not the case in other areas of Alaska’s
586,000 square miles of land. In 1897, a study group from the Office of Experiment Stations identified 15 million acres as
having agricultural potential4. The Tanana River Valley in interior Alaska and the Matanuska-Susitna River Valley and Kenai
Peninsula in southcentral are regions with soils that have agricultural potential. Growing seasons though short, have sufficient
growing degree-days and precipitation to support a diversity of crops. Range lands on the Seward Peninsula in northwest and
northeast Alaska, Kodiak Island in southcentral Alaska, and the Aleutian Peninsula and Chain support a diversity of livestock.
After the Russian’s failed efforts at production of food crops, there
were a number of vigorous start-ups for the agricultural industry in Alaska5. During the late 19th and first half of the 20th
century, the stimulus for agricultural development was the lack of adequate transportation to provide frontiersmen with food.
During the gold booms in interior Alaska in the earlier 1900s, farmers supplied food to the miners. In the 1920s, farms in
southcentral Alaska and the interior were essential to construction of the federally supported Alaska Railroad. In the 1930s,
the Matanuska Colony, a federal agricultural project, was established to provide relief for depression farmers from the north
central United States. Each of these efforts left a core of farmers and some processing facilities. However, none maintained
the momentum to continue expansion into a viable commercial industry but rather these efforts evolved into a regional cottage/subsistence
There were later attempts to revive the agricultural industry in Alaska. Federal
and state homesteading programs in the 1950s (federal) and from 1959 through the 1960s (state) failed to help the agricultural
industry grow. Those who obtained the lands had access to federal loan programs and information but were left to develop the
remaining components of an agricultural system on their own.6 Interestingly, a high percentage of the homestead lands have
remained in agriculture. Private capital and financing provided the base for construction of farms and processing with assistance
from the federal and later the state government.
The state of Alaska decided to invest in agriculture in the late 1970s at
the beginning of a prosperous period that resulted from the discovery of oil in Prudhoe Bay in 1968. In 1976, the state legislature
passed "Resolution 76" providing a positive state policy toward agriculture. The ‘project agriculture’ model,
used internationally to stimulate development was followed. Two large projects were planned. In 1978, clearing of 50,000 acres
in interior Alaska marked the beginning of the Delta Agricultural Project targeted for the production of small grains to support
a red meat and dairy industry. It depended on state supported loan programs and state supported construction of appropriate
infrastructure. Lands were cleared in 1983 to begin the Pt. MacKenzie Project in southcentral Alaska. The objective was to
provide land and farms in the Matanuska-Susitna Valley to expand the dairy industry. Like the Delta Agricultural Project,
MacKenzie depended on state loans and dollars for infrastructure but it was building on a base of existing farms and processing
facilities that were constructed and financed by federal dollars as well as some private capital. These projects did not develop
as planned. However, they did stimulate interest in the industry.7
Federal and state programs to stimulate agriculture in Alaska have been supported
by projections and promises that agriculture would become a major Alaskan industry. Some might say that these programs were
supported on myth rather than fact. On the other hand, there is a myth that agriculture in three decades has failed. This
myth is based on reasoning that the ‘last great hope for agriculture’ – the Delta and Pt. MacKenzie Projects
– did not develop as planners forcast. Reality is that agriculture expanded during the 1980s particularly in the small
grain, dairy and greenhouse segments. This expansion continues in the 1990s and early 2000s but the characteristics of the
industry are changing.
Definition and Scope of Agriculture in Alaska
The traditional definition of agriculture is "the production of food and fiber."
This restrictive definition has broadened as agriculture has evolved and more emphasis has been placed on diversification,
niche markets, and value-added processing. Webster’s Third New International Dictionary defines agriculture as "the
science or art of the production of plants and animals useful to man and in varying degrees the preparation of these products
for man’s use and their disposal (as by marketing)." It is not restricted to food products or domesticated crops and
animals and is indeed a very broad definition.
Much of Alaska’s agriculture has nothing to do with production of food
and fiber. While some Alaska farmers produce traditional crop and animal products others gain income from production of such
non-traditional products as grass seed for revegetation in oil fields, gold mines, and along roadsides. Entrepreneurs also
derive income from agricultural tourism or raising and stabling horses and dogs for recreational purposes. A greenhouse operator
may grow tomatoes, cucumbers, and other vegetables for the fresh market, a part of traditional agriculture, but a far greater
source of income may be from bedding plants, flower baskets, cut flowers, compost, potting soil, and landscape materials.
Unfortunately, the Alaska Agricultural Statistics Service does not report farm gate receipts for non-traditional enterprises.
In their defense, these data are difficult to report because of the proprietary nature of the information.
Alaska’s agricultural industry has unique advantages. The state’s
isolation from other agricultural areas and its severe winters reduce the hazard of insect and disease infestation in crops.
This is a regime ideal for the propagation of disease free seed stock for export. These same reasons contribute to limited
use of agricultural pesticides in a pristine environment ideal for production of ‘safe’ food. Another advantage
of the Alaskan climate is the effect of cool temperatures and long day length on increasing the sugar content of vegetables
and enhancing the color intensity of flowers. The climate regime may also contribute to increased levels of antioxidants in
native and cultivated plants8Alaska’s farmers also take advantage of the climate to supply non-traditional products
that enhance the environment. Soils disturbed by road construction, military operations, oil field development, and mining
must, by federal and state law, be revegetated with plant species adapted to the area. Plant seeds and propagation materials
must be grown in the environment in which they will be used. Production of agricultural products offers an efficient solution
for the disposal of waste products. Shell and finfish wastes are used as protein supplements in animal feeds. Municipal sewage
and shell and finfish waste are used as soil amendments in agricultural operations; a desirable alternative to ocean dumping,
incineration, or shipping wastes out of Alaska. The Alaskan agricultural industry is exceptionally diverse and epitomizes
the broad definition of ‘agriculture’.
There are seven major agricultural product categories in Alaska’s agricultural
industry: red meat (beef, pork, and reindeer), small grains (barley and oats) hay (grain and grass), milk, potatoes, vegetables
(lettuce, cabbage, carrots, the squashes, cole crops, beans, and peas), and greenhouse and nursery crops (tomatoes, cucumbers,
peppers, bedding plants, and potted florals). In 1960 (statehood was granted in 1959), total agricultural farm gate value
for these products was slightly above $3.5 million (Figure 1.) When the first barley crops were harvested in 1984 from the
Delta Agricultural Project and milk receipts began to increase in 1985 because of new farms at Pt. MacKenzie, farm gate values
peaked at over $30 million (Figure 1).
The mix of the seven product categories in Alaska’s agricultural industry
has varied over the years (Figure 2). Milk receipts dominated the industry exceeding 50% of the total farm gate value in
Figure 1. Total farm gate receipts from 1970 through 1993.
the early years following statehood. In the late 1980s and early 1990s, milk
production dropped. By 1992, milk, hay, and potatoes held approximately 75% in equal parts of the farm gate agricultural product
value (Figure 2).
Figure 2. Agricultural industry product mix from statehood to 1990.
In 1993, the Alaska Agricultural Statistics Service changed its format for
reporting data. Total farm gate receipts are shown in Table 1. The greenhouse and nursery category no longer included landscaping.
No information is available for receipts in the landscape segment after 1992. Table 1 also shows that the greenhouse and nursery
segment of the industry comprises approximately 50% of farm gate receipts. The Alaska Agricultural Statistics Service began
Table 1. Total Agricultural Farm Gate Receipts
($ X 1000)
Greenhouse and Nursery
* All livestock and crops excluding aquaculture
** All other livestock (poultry and eggs starting in 1995, sheep and lambs
in 1998, equine, goats,
honey, muskoxen, and reindeer). and crops (all horticultural field crops excluding
potatoes, head lettuce,
cabbage, and carrots.
Figure 3. The dominance of the greenhouse segment of the agricultural industry
the greenhouse and landscape industry in 1977. Rising economic indicators
affecting the sales of flowers and bedding plants and perhaps increased activity in other agricultural sectors contributed
to the rapid increases in farm gate receipts for the greenhouse segment of the agricultural industry. Figure 3 shows the dominance
of the greenhouse and nursery sector as well as the mix of the other six categories in Alaska’s agricultural industry.
There were 2 million acres in farms and ranches in 1960.This dropped to half
by the 1990s. The total crop acres harvested peaked in 1985 (Figure 4.). Increases coincided with activity in the Delta and
Pt. MacKenzie agricultural projects. The total number of farms and ranches rose from 420 in 1960 to a peak of 670 in 1986
settling in the 500s in the 1990s (Figure 4). Hogs, beef cattle and dairy cattle numbers have fluctuated. Fluctuations depend
largely on market prices for the final product and availability of feder cattle; dairy calves, imports from Canada, and local
cow-calf operations. However, two peaks in dairy and hog production are notable and depict the fragility of the profile of
the agricultural industry in Alaska. As farms expanded at Pt. MacKenzie, dairy cattle numbers rose. A series of bankruptcies
at MacKenzie and sales of farms in the Matanuska Valley because of urban expansion caused the numbers to drop. Some of the
decrease was mitigated by the opening of new dairies in the Delta area of the Tanana Valley. A large hog farm opened in the
Delta Agricultural Project in the mid 1980s and hog numbers increased. Deaths in the family and increasing problems competing
in a price-falling market caused the farm to close and hence, hog numbers to drop. Farming operations in Alaska are few and
in a number of cases, a single farm business can affect the statistics.
Figure 4. Number of farms, land in farms, and animals on farms from 1980 through
The agricultural industry provides both year-round and seasonal jobs. In 1995,
the last year statistics were reported, 1,000 people were employed excluding those by greenhouses and nurseries; 600 were
family members defined as unpaid farm labor. Except in the dairy sector, most labor is seasonal. Labor statistics for the
greenhouse and nursery sector indicate there were 1,575 workers in 1986, and 1,825 in 1990, the only years labor statistics
were reported. Unofficial estimates in 2001 indicate that the number is well over 2,000 excluding those working in retail
The three major regions for production of agricultural products in Alaska
are the Matanuska-Susitna Valley, the Tanana Valley, and the Kenai Peninsula. Agricultural products from these