If Russian and Ukrainian bellies have as much potential as their soils, then world grain markets probably won’t be wrecked by the agricultural potential of these countries, says Jack Wilkinson, president of the International Federation of Agricultural Producers.
“I’m not pessimistic,” said Wilkinson, the former head of the Canadian Federation of Agriculture, after his Jan. 23 speech to Keystone Agricultural Producers.
“I think there’s potential that (non-food use and domestic consumption) can grow as fast as countries like those in Eastern Europe can increase production.”
Wilkinson said poorly farmed land in the former Soviet Union and Eastern Europe could produce much more grain. But people there will also probably want to consume more meat if they start making more money. Producing that meat would use up grain.
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“They’ve been eating cereals all the time. They actually want pork mixed in with that stuff,” said Wilkinson.
The same goes for other developing countries.
“They don’t like to eat a bowl of rice and that’s it for the day.”
Wilkinson said many European cities are also demanding that automotive fuel contain biodiesel, and that demand could suck up a lot of agricultural production.
China is a good example of how a developing nation’s people can produce more and, at the same time, demand more.
“You can’t keep up with all the (malt barley demand) growth in China because a few more people have one more beer,” said Wilkinson.
“When you’ve got a billion people, a few percentage changes are a massive market.”
But Wilkinson said Canadian farmers shouldn’t expect to see Europe become a market for Canada anytime soon.
The European Union is getting ready to allow 11 million farmers inside its market when countries such as Poland join. That flood of farmers and cheap food is going to spoil the EU appetite for grain from countries like Canada.
“They say, ‘if we’re going to give all of this access to Poland, Romania, and pay all of these taxes … the last thing we’re going to do is take on more competition from around the world,’ ” said Wilkinson.”I think they’re going to fight very hard.”
