Two-thirds of world population live in the 16 most populated countries

August 17, 2010

When looking at their respective demographics, economic situations and food security status possible future scenarios can arise from this list.

The most obvious is probably that many countries on this list have little food security. Considering that many of these countries have a young, poor and increasing population, political stability is quite fragile. As long as this remains, the consequences of food inflation must be taken very seriously.

Country

Population

% of world population

China

1,337,320,000

19.6

India

1,180,220,000

17.3

USA

309,199,000

4.5

Indonesia

231,369,500

3.4

Brazil

192,860,000

2.8

Pakistan

169,410,000

2.5

Bangladesh

162,221,000

2.4

Nigeria

154,729,000

2.3

Russia

141,927,297

2.1

Japan

127,530,000

1.9

Mexico

107,550,697

1.6

Philippines

92,226,600

1.4

Vietnam

85,789,573

1.3

Germany

81,882,342

1.2

Ethiopia

79,221,000

1.2

Egypt

78,200,000

1.2

 Total  

4,531,656,009

 

66.7

 

What came to my mind when I saw the list the first time was the following.

The cluster Pakistan-India-Bangladesh represents 22.2% of the world population. This region is very sensitive to climate events, as the current floods in Pakistan demonstrate. The monsoon is the main factor that influences the level of crop production. These countries are below food self-sufficiency, and their agricultural infrastructure (and overall infrastructure in general) is in bad need for further development. However, the quality of agricultural land is good with around 40% of arable land. The task of India is huge. It has about 70% of its population in agriculture, and if the USA had India’s population density, there would be 3 billion Americans, 10 times its current population. In such a situation, the USA would not be self-sufficient, either. Agricultural reforms are necessary to improve yields and economic development is necessary to provide more inhabitants with higher revenue. It will take time, but expectations for the Indian economy are positive. Subsistence is not a good economic model. A good relationship between India and Pakistan is paramount for the stability of the region. A stable Pakistan is essential for the stability of the world.

In North America, I can see dramatic change coming. With two countries, Mexico and the USA, in sharp contrast with each other in the top 16, something will happen. The USA will remain an economic superpower and any events in that country will affect the world economy and politics. Mexico is growing but it needs to improve its economy and achieve better social stability. Poverty is fuelling many issues and the price hike of corn of 2008 has showed that it would not take much to cause food riots. The issue of immigration of Mexicans into the US will not go away, and no wall will stop it, especially with Mexico having a strong population increase. The difference in population numbers of the two countries will shrink. The USA and Mexico will have to develop a joint economic development program for the region to avoid an uncontrollable situation in the long term. I think that we will see more and more Mexicans settling in the USA and become the farmers of the future over there. However, climate conditions will probably affect the geographical distribution of productions. The southwest of the USA is increasingly suffering from water scarcity, and the area spreads. This will affect the distribution of the population over the continent, and it will affect Canada as well.

South East Asia has three representatives on this list: Indonesia, The Philippines and Vietnam. This region shows a strong population increase. From a food production point of view, geography tells that aquaculture has to be a leading, if not the leading, food source for the future. And this is exactly the direction that these countries are following. Rice is essential in this part of the world, and there is no doubt that the South East Asian Emergency Rice Reserve will be tested at some point in time.

Brazil is growing, demographically and economically. It is becoming an economic powerhouse, in particular in agricultural products. However, much still needs to be done to improve infrastructure and performance. In the future, I expect to see joint agricultural policies between a number of Mercosur countries, especially with Brazil, Chile, Argentina and Uruguay as the initiators. Export has led agricultural production of these countries in the past, but I expect to see them to rebalance policies towards feeding the South America market as well in the years to come.

The other thing that jumped out of the list is Africa. I doubt that many people would have expected Nigeria to be ranking #7. Africa will be an important element in the 21st century economy. The continent’s population will double in the coming 40 years and many African countries are attracting foreign investments. If this happens in orderly manner, which is far from sure at this stage, I would expect Africa to experience a boom comparable to the one that China has had over the last three decades. The continent is open for business and the rules of engagement are exactly what adventurous pioneers can wish for. Africa has tremendous potential for food production and foreigners are developing agriculture actively for their own food supply, but neither African countries nor investors should forget to include the Africans in the wealth creation, and help them earn the money to feed themselves. What will happen in Africa, will affect all of us.

Copyright 2010 – The Happy Future Group Consulting Ltd.


Future Harvests – A preview of the book

July 24, 2010

My book, Future Harvests, is expected to be published before the end of August.

Here is a preview to give you a flavor of the content.

For a full view, please click on the thumbnails.

 

 

 

 

 

 

 

 

 

 

Here is a sample containing the table of contents and the preface of the book:

 

For the video trailers, please visit my YouTube channel.


Is the food company grab the next step beyond the land grab?

July 12, 2010

In parallel with land tenure deals in developing countries, I foresee a new trend to develop strongly in the years to come.

In order to increase food security, countries in Asia and in the Arab world will invest more aggressively in food and agriculture companies.

In China, the search for acquisitions is gaining momentum. A first attempt, although failed, by China’s Bright Food group to acquire Australia’s CSR sugar is an indicator is this trend to come. But China is not the first country to initiate this.

For instance, Qatar’s sovereign wealth fund created Hassad Foods to invest in food related projects in Qatar and abroad. The purpose of Hassad Foods is to help Qatar achieve food security. They aim at developing their activities in South America and Africa, with the expressed goal of completing at least six projects by the end of 2010. Their focus is on basic crops such as sugar and wheat, but they look at projects in the poultry and livestock sectors as well. As countries realize the limitations and the political risks of focusing only on farmland ventures, they will diversify their possibilities to improve their food security situation.

As the approach of sovereign funds is to focus on long-term food security, the type of investments in food companies might change as well. This will be a different approach from activist investors, such as hedge funds, that try to influence short-term management decisions purely for share price purposes.

Copyright 2010 – The Happy Future Group Consulting Ltd.


Future Harvests – The book is coming soon!

April 9, 2010

 

The editing of my book “Future Harvests – The next agricultural revolution” is about completed. All that is left to do is developing the cover and start the publishing.

I have already received orders, even before the book is out. That is quite a good sign. And a great surprise for me.

If you wish to be updated automatically when the book is published, just subscribe in the sidebar window on the right.

To describe the topics addressed, I have posted three short promotional videos on YouTube. In previous articles (The fun of writing this book and The next agricultural revolution), I had already given an idea about the content of the book.

Video #1: The Fundamentals (duration 2:37) – Introduction to the background and fundamental principles mentioned in the book “Future Harvests – The next agricultural revolution” to achieve food security for 9 billion people in 2050. Topics such as demographics, the shift in economic power, the control of food  and food security strategies are reviewed. Sustainability, innovation, efficient market driven food production and strong leadership are required.

or click here if video does not appear

Video #2: The Actions (duration 2:12) – A short review of some of the actions mentioned in the book to achieve the objectives. Solving the water challenge, finding new land for production, urban farming, hydroponics, farming the desert, rebuilding fisheries and developing aquaculture further are all possibilities.

or click here if video does not appear

Video #3: The Questions (duration 3:08) – A sample of some of the questions raised in the book. They cover technology, land deals in Africa, improving yields, restoring soil fertility, change in consumer needs, organic farming, risks of conflicts, biofuels or meat are some of the topics presented.

or click here if video does not appear

If you know someone who could be interested by the topics on this page, please pass it on!


Uruguay, the quiet leader in beef?

November 12, 2009

Here is an interesting article about how Uruguay works towards a healthier future.

Not only does the country invests a lot in renewable energy but it works in improving its beef, too.

Uruguay’s  100%-traceable, hormone-free, grass-fed beef farming is offering many answers to the concerns of today’s consumers, and the system rewards the farmers doing the right thing, too! Read the article at http://www.benzinga.com/36898/hamburgers-in-montevideo

Not the largest producer, but certainly among the smartest.


Who will be the farmers of the future?

November 11, 2009

While most of the discussions about the future of agriculture and food tend to focus about how to feed 9 billion people, and about whether it should be organic or industrial, one question seems to be left aside, though it is a very important one: who will be the farmers.

If the forecast of the UN is correct and by 2050 when we are 9 billion, 70% of the people will live in cities, while today this number  is only 47%, this means that in fact the rural population will decrease by about 25% from the current numbers (2.7 billion vs. 3.6 billion today). This means that there will be a lot less farmers in the future.

Farmer of the futureSo, who will they be and where will they be?

A lot of the good agricultural land is in the Northern hemisphere, and in areas where not only the population numbers  are stagnating, but these are regions where the average age of the population is increasing from an already rather high level of about 50% of the population older than 37. These regions, North America, Western Europe and Eastern Europe are not likely the countries where we can expect a surge in urban population. This will happen mostly in Africa, Asia and Arab countries.

These Northern hemisphere countries already have large commercial farming structures and, unless they train many new farmers, the concentration trend is likely to continue, meaning even less farms, and larger farms than today.

In countries where the agriculture infrastructure is more fragmented and farms are smaller, which are the countries where the urban population is going to increase the most, there clearly is a need to rationalize production and increase yields to feed this new population that will have very little possibilities to grow food where they live. This means a “revolution” in the way agriculture will have to be organized and structured. Asia and South America have already engaged in this process for a few decades, yet depending on the countries they will face different challenges, mostly about access to water and ensuring the sustainability of their environment.

The continent where agriculture has stayed the most traditional is Africa, where a large share of the land is used for subsistence. Many African countries have struggled for years with poor policies and a lack of investment to help a proper development. This has resulted in lower yields over time. As such, this also means that Africa is the continent with the highest potential for improvement, although this would have to be managed very carefully, as climatic and socio-cultural conditions are very sensitive.

Therefore, we can conclude that in the future, not only will we have fewer farmers, meaning fewer farms, but also in the same time, we will need to increase production and train a new generation. All of this will require a fair amount of capital that many farmers alone cannot afford, especially considering how their income situation usually is.

This will be no surprise to see more capital coming from large corporations, investors and governments. This is already happening in Africa with the land purchases and leases, and we can expect his to happen. There is a huge (rather captive) market where demand probably is going to outpace supply, and there is a lot of capital waiting to enter markets where money can be made in trade activities.

Farmers wanted!

Copyright 2009 The Happy Future Consulting Group Ltd.


How much can the rule of 80-20 tell us about the future?

September 3, 2009

We all have heard about this rule across all industries, including agriculture and food. Eighty percent of the food would be produced on 20% of the farms and vice-versa. If it still applies in the future, it can indicate us how our food production and supplies will look like in the future. Of course, this is always a theoretical exercise, but it is quite convenient to elaborate on our thoughts.

As the population is expected to grow quite strongly in the coming decades, especially in urban areas, this could indicate two dominant trends:
• Further size increase of the largest farms and further industrialization of agriculture and food for global markets, although the number of farms in this segment would not increase strongly.
• Strong increase of the number of small farms involved in specific value chains and strongly linked with their local economy.

Industrial agriculture
Producing more, yet in a sustainable way. That is the challenge!This group will continue to be involved in mass production of commodities for global supplies, like this is the case today.
Yet, they will face an increased pressure to adapt to the requirements of sustainability, which technically is quite possible. New systems and more efficient technologies will be the pillars of its growth and development. They will have to find ways of reducing the amount of chemicals in crops and the amount of pharmaceuticals in animal productions
The requirements for capital will be quite high and the sector will be led by increasing larger corporations, by an increasing level of capital by large private investors and, last but not least, by some governments. This agriculture will innovate further and will be developed thanks to this capital. It will use automation and mechanization to reduce the dependence on labor. Mergers & acquisitions will continue in the agricultural sector and a few large blocks will remain, dominating their sectors.
Their mandate will be about more control the natural conditions of production and about reducing to a minimum their impact on air, water and soil, by using less polluting transport methods, water preservation, effluent treatment and soil preservation. They also will have to engage in maintenance of their environment.
The role of this type of agriculture will be to bring to market large amounts of affordable food for the masses, and should play an important role in strategies around food security, which is where corporations and government will interact on a regular basis.

Local food value chains
Closer to natureThis sector should undergo a strong growth and be build in a market-driven approach. These are the farmers that produce specialty products aimed at serving either a very specific segment of the retail or foodservice market.
This trend, which has been already initiated around concepts such as organic or authentic, will evolve into a more integrated local economy, and the initial concepts will probably become less differentiated as food production in general, be it industrial or traditional, will use more sustainable techniques.
Contrarily to the common belief, this agriculture will be developed thanks to very efficient techniques, but will be centered relatively more about labor and relatively less about capital. In this case, efficiency does not necessarily mean intensification.
We must not underestimate the significance of this part of the food production, as it will play an important role. However, we must not expect this type of agriculture to be the solution to feed the world, and this is not the purpose of the farmers involved in such food production chains.

This type of farming will grow in two different environments:

  •  In “developed” countries to serve a increasing, but aging, population more demanding about the origin and the production methods, and who is ready to pay a premium for the perceived better quality. The angle will be about quality, transparency, sustainability, traceability and as close to zero a use of chemicals and pharmaceuticals. In some areas, it could help strengthening a local economy and local communities.
  • Developing a local economy thanks to agriculture (Picture: FAO) In emerging countries, the development of a local agriculture, and aquaculture, will be a key driver of economic development for under industrialized and/or under urbanized regions. It also will be a way of slowing down the migration of population to urban centers and limit social problems, by creating satisfying economic conditions and by securing food supplies locally. This farming will be about basic needs, before marketing.

Copyright 2009 The Happy Future Group Consulting Ltd.