Future Of Food For Distribution
Transcript of Future Of Food For Distribution
Global warming will undo some traditional exporters
India tips over to become importer
Australia will import more
Former Soviet Union will export moreN America will
export more
• Most production is kept for domestic use, only a small amount is traded. E.g. only 6.5% of rice is traded.
• Any tightening in supply e.g. crop failure in Australia from drought would lead to a supply shock and lead to food price inflation.
Vulnerable to supply shocks
• The new middle classes want more meat, dairy, eggs.• China’s consumption will approximate the USA near 2031. Grain
consumption is projected to be two-thirds of current grain harvest and four fifths of current world meat production.
Asia’s new middle classes move up the food chain
Changing Eating HabitsMeat consumption in China per capita
20kg
1980
125kg
2031*
50kg
2007
Pressure on resources
10,000 – 13,000 liters of water is needed to produce 1kg of beef
1,000 – 2,000 liters of water are needed to
produce 1kg of wheat
5 kg of grain is needed to produce 1kg of beef
*Approx US consumption today
Biofuels and Grain Prices• Corn based ethanol is viable with high oil prices.• This triggered a substitution effect, raising grain prices.• International Food Policy Research Institute has shown that increased
biofuel demand is estimated to have accounted for 30 percent of the increase in weighted average grain prices.
Simulated Real Grain Prices, 2000-2007 (US$/metric ton). IFPRI May 2008
30%
Is the crisis over?• The Food and Agriculture Organization reports that commodity prices
have started to fall, but they are not likely to drop to the low levels of previous years.
• Food production needs to rise by 50% by 2030, and double by 2050, to meet the needs of rising population and new middle classes.
• Ag yields need to rise to avoid future turbulence.
Underinvestment in Ag leads to falling yields• The original green revolution was based on better seeds, irrigation
and fertilizers. Grain production increased by 250%. • Underinvestment in Ag due to rapid urbanization and industrialization
has led to falling yields.• In the next phase of the green revolution, new solutions will have to
increase yields through better seeds while addressing resource constraints in rising oil prices, water shortages and less arable land.
USA
57.7m 6% increase
China
3.8m 9%increase
countryHa
planted%
increase2006-7
Brazil
15m 30%increase
India
6.2m 63%increase
Philippines
0.3m 50%increase
S Africa
1.8m 29%increase
Argentina
19.1m 6%increase
Canada
7m 15% increase
Future Seed• GMO has been in the food supply for years and no harm has been
observed.• Food stressed countries have gone big time into R&D and production.• Watch out for future GMO powerhouses Brazil, China and India.
Vertical farming is a popular idea for cities• Proposed by Columbia Uni. No prototypes yet. • Estimate for 150 30-storey vertical farms to feed NYC (pop: 8 mil)/year. • China, Abu Dhabi and Korea exploring vertical farming.
Pasona O2, Tokyo
Stem Cell fast food • Currently costing $100,000 per kg! More than Kobe beef …. • Meat processing companies hope to start selling affordable factory
grown pork within a decade.
• Genetic diversity is being eroded, making the need for genebanks urgent.
• There are 1,400 around the world now, but many are in unstable locations.
• The World’s Seed Bank - Svalbard Global Seed Vault – is built in Norway to house staple food crops. IRRI (Manila) is working in partnership with them to conserve rice varieties.
Doomsday Vault for diversity preservation
New Agriculture is about IP, not land or labour.
Fertilizers
Seeds
PesticidesHerbicideFungicide
CropProduction
FoodProcessing
AnimalFeed
BioenergyFeed Lots
Sales Logistics
FeedAdditives
Retail Consumer
PulpFiberGrainCrops
Adapted from ICAC Commodity Profile, IFPRI
IngredientsAdditives
DryingMilling
HuskingConversion
StorageBlending
ModificatnEnd Use
Equipment
Land
Higher yield rice
Rice, Pulp and Paper
Drought-resistant rice
Salinity-resistant rice
Temasek Life Sciences Laboratory (www.tll.org.sg)DNA markers
selective breedingBollworm resistant cotton strains
Yaoming trees for pulp
Dr Stephen Cohen, Executive Director of TLL, elected as Fellow of the Royal Society
• Aquaculture is expanding while marine capture fisheries have reached a ceiling.
• The new Asian middle classes will demand more high-value fish as incomes rise. Demand for hatchery-reared fingerlings will grow.
ST Oct 5, 2007 S'pore's very own super sea bass Hatched in AVA's research tanks..
Aquaculture is promising
• Technologies to help food-stressed economies like China, India expand the use of existing farmland, or rehabilitate degraded farmland will be in great demand.
• What does it take to be a hub for R&D and reselling solutions. E.g. Sell China’s drought/salt-resistant trees to ME.
PRC Coastal protection program requires 100 mil salt resistant trees in next 10 years
..salt tolerant poplar tree soaks up salt in China’s saline wastelands (30 mil ha) ..the land is arable after 10 years.Bloomberg News 12 Sept ‘07
Rehabilitate degraded farmland
• In a bio economy, gene diversity is the raw material for future wealth, and a reliable gene bank is the most important resource for climate- ready crops.
• A tropical gene-diversity bank can be a source of IP, R&D for agri- asset and new material companies to develop new agricultural products.
A tropical gene bank in Singapore
Rice Gene bank, IRRI, Manila
• Agricultural fields will assume the same significance as oil fields. Basic raw materials will be genes.… Plants will be the raw materials for new fuels, materials and medicines.
• Geopolitical power may well shift from desert-bare oil countries towards tropical regions richly endowed with biodiversity.
• What does it take to be the world center for tropical bio-economic development?
The EU has invested large sums of money and manpower on becoming a knowledge-based Bio-Economy by year 2025.
Future: Laying the foundation for the bio economy