Prosperity key to forecast growing food demand

The dominant mind set among policy makers and those who speak at farm and food conferences is still the idea of food scarcity if farm productivity doesn’t keep pace with population rises.

Weather volatility associated with climate change is another threat to global food security that is often identified.

A lot of the increase in food demand in the last decade or so was the result of hundreds of millions of people in the developing world climbing up the prosperity ladder and adopting more protein-rich diets.

Eating more meat required more livestock and feed grains.

Recent history fueled the scarcity mind set, but the experience this year shows just how abundantly productive modern farming techniques can be given the right weather.

I’m not saying 2013 production levels are the norm into the future, but the three or four years preceding this year might also be seen as unusually troublesome regarding global weather.

The weather problems of the previous years led some to doubt the claims of real productivity gains from genetically modified crops and precision farming. 

For example, the U.S. Department of Agriculture lowered the trajectory of its corn yield increase trend line early this year. However, this year’s global harvest shows we shouldn’t hastily dismiss the potential of agricultural technology.

It is worth considering that we could be headed into a period when farmers’ productivity outpaces demand growth. That was the experience through much of the 1980s and 1990s, and the results were not good for farm income.

Then the 2000s arrived and the surpluses disappeared with biofuel development and fast rising crop exports, particularly of oilseeds to newly prosperous China.

China’s key interest was oilseed meal to feed its expanding pork and poultry industries.

Per capita income in China’s urban areas about doubled between 2000 and 2010. Meat consumption, mostly pork, rose 20 percent and poultry consumption rose 88 percent, according to an Australian study. China’s per capita pork consumption is now at developed world levels, but its poultry and beef consumption still lag.

And there are stark differences in meat and poultry consumption between relatively affluent urban people and poor rural peasants, who still number in the hundreds of millions.

Over the same 10 years, China’s soybean imports from all sources rose almost 300 percent to 52.34 million tonnes.

This food demand growth came at a time when economic growth in China often topped 10 percent a year, a phenomenally high rate. Indeed, many developing countries were growing at extreme rates that were likely unsustainable in several ways — economically, socially or environmentally.

China’s gross domestic product growth this year has slowed to 7.5 percent, and it appears levels of six to seven percent can be expected for the rest of this decade. 

Most forecasters also expect a slower pace of growth in the rest of the developing world as governments try to build more sustainable economies.

To that end, China’s communist government recently announced reform proposals, soon to be followed up by the government. They include rural reforms such as private land ownership and more freedom of movement for rural people.

These reforms, if they help lift hundreds of millions of peasants from poverty, should stoke demand for meat and grain.

It would be good news for export oriented farmers.

Hopefully, the rise out of poverty through economic growth and more equitable income distribution will continue across the developing world. It is a goal unto itself because it helps end suffering, but it will also help match food demand to what could be bountiful harvests from agricultural technology improvement and investment.


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