Farmland Barometer - July 2011
Understanding the Big Picture
If you don't know where you are going - - any road will get you there. That's why it is important to know what is going on globally. Here's some of those activities:
- U.S. Dollar - Most economist predict a declining dollar for the foreseeable future.
- Worldwide Economic Growth - Middle class growth in developing nations will lead to more food imports.
- Trade Policies - Trade liberalization will increase as will trade worldwide.
- Energy Costs - Agriculture is energy intensive so our cost of production will be rising.
- Biotechnology - The sound science behind biotechnology research will lead to higher yields and wider global acceptance.
- Global Farmland - Drought tolerant corn could lead to significant acreage increases. Watch Africa, Latin America and other spots on the globe.
- Supply and Demand - We have a very tight balance between world crop production and overall usage. Crop production problems could cause serious problems.
- The China Factor - An enormous and growing food and feed demand will continue for the expanding population.
- Soviet Union Countries - Have rising grain production and export capabilities.
- Water Availability - Agricultural production worldwide will be threatened as population pressures reduce water availability.
- Fertilizer - The United States is growing more dependent on fertilizer imports.
- Meat Consumption - World meat consumption is rising rapidly driving rising export demand for feed grain and protein meal.
- Soybean Protein Consumption - Is up 70% worldwide in the last decade.
- Poultry Demand - Up 40% globally and rising more quickly than beef and pork.
- Corn and Soybean Consumption - Worldwide soybean consumption is up 48% versus 37% for corn and only 14% for rice in the past decade.