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Future Of Food For Distribution


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  • 1. The Future of Food Updated on 8 Oct 08
  • 2. Food headlines in The Economist so far Aug 07 Dec 07 Mar 08 Jun 08 Today
  • 3. Overview of the Food Crisis
  • 4. Who’s producing, who’s buying
  • 5. Global warming will undo some traditional exporters Former Soviet Union will export N America will more export more India tips over to become importer Australia will import more
  • 6. Vulnerable to supply shocks • 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.
  • 7. Higher grain prices are passed down the chain
  • 8. Food price rises hurt unevenly
  • 9. Populations are expanding fastest where it is most difficult to grow food
  • 10. Farming accounts for 70% of water use. Water shortages mean food shortages.
  • 11. Asia’s new middle classes move up the food chain • 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. Changing Eating Habits Pressure on resources Meat consumption in China per capita 1980 2007 2031* 1,000 – 2,000 liters of water are needed to produce 1kg of wheat 125kg 5 kg of grain is needed 20kg 50kg to produce 1kg of beef 10,000 – 13,000 liters of water is needed to produce 1kg of beef *Approx US consumption today
  • 12. 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. 30% Simulated Real Grain Prices, 2000-2007 (US$/metric ton). IFPRI May 2008
  • 13. The next Green Revolution?
  • 14. 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.
  • 15. 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.
  • 16. 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. Canada 7m 15% increase USA China 57.7m 6% 3.8m 9% increase increase country % Ha increase planted 2006-7 Philippines India 63% 6.2m increase 0.3m 50% increase Brazil 15m 30% increase Argentina S Africa 19.1m 6% 1.8m 29% increase increase
  • 17. 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
  • 18. 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.
  • 19. Doomsday Vault for diversity preservation • 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.
  • 20. IDEAS
  • 21. New Agriculture is about IP, not land or labour. Pesticides Herbicide Fungicide Drying Storage Fertilizers Bioenergy Milling Conversion Blending End Use Feed Lots Pulp Husking Modificatn Fiber Crop Animal Feed Grain Seeds Production Additives Feed Crops Ingredients Food Equipment Additives Processing Sales Logistics Retail Consumer Land Adapted from ICAC Commodity Profile, IFPRI
  • 22. Temasek Life Sciences Laboratory ( DNA markers Bollworm selective breeding resistant cotton strains Higher yield rice Drought-resistant rice Yaoming trees for pulp Salinity-resistant rice Rice, Pulp and Paper Dr Stephen Cohen, Executive Director of TLL, elected as Fellow of the Royal Society
  • 23. Temasek Life Sciences Laboratory (
  • 24. Aquaculture is promising • 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..
  • 25. Fish farms provide half of world supplies in 2015
  • 26. Rehabilitate degraded farmland • 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. ..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 PRC Coastal protection program requires 100 mil salt resistant trees in next 10 years
  • 27. A tropical gene bank in Singapore • 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. Rice Gene bank, IRRI, Manila
  • 28. Future: Laying the foundation for the bio economy • 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.
  • 29. Thank you