Jack sharke's List: Investing in food & similiar industries

• • population growing leading to increase in demand for food. supply is not matching demand.
    
    Urban population relying more on processed food.
    
    Land is required for food eg agriculture. Land for agriculture might boom.
    
• SINGAPORE, Nov 14 — The days of inexpensive food are coming to an end. Because of rising populations, incomes and urbanisation, food demand is expected to grow, and the composition of that demand will change towards higher value and more resource-intensive items, such as meat products. Meanwhile, supply will be constrained by a shortage of land, decelerating yield growth, competition from biofuels, water scarcity and climate change.

  • increasing demand and decreasing supply
• at the trend in food prices over the past decade. Prices are up almost 80 per cent since their lows in mid-2002
• The United Nations estimates global population is likely to grow by around 35 per cent from the current 6.8 billion by 2050. That means that a 70 per cent increase in food production from 2005-07 levels would be required.
• By 2050, more than 70 per cent of the world’s population is expected to live in towns and cities, boosting consumption of meat, fruits, vegetables and processed food products.
• Land is likely to be one of the biggest constraints in the expansion of output.
• The agriculture sector is highly water intensive, but water is an extremely limited resource in many places. Pollution, aquifer depletion and climate change add to the problem.
• Weather patterns are already changing, with more rainfall predicted in the northern and southern latitudes and less in the sub-tropics, heightening the risk of droughts and floods.

  • Singapore is already experiencing the effects of erratic weather changes

• In recent years, biofuels have become a significant element of demand for agricultural commodities such as corn, sugar and palm oil. There are two implications.

   

  First, the expansion of biofuels, unless they are developed using non-food feedstock, will lead to greater competition for arable land, thus increasing costs and prices for food production. Second, agricultural prices, particularly for biofuel feedstock, will likely become more correlated with energy prices and reflect the same levels of volatility.

  • more competition for land. Agricultural prices will fluctuate more violently like energy.

• Asia’s huge populations and its rapid economic growth rates make the region by far the most influential in determining global food demand.

   

  Asia is also the world’s biggest supplier of food. But there are limited possibilities for dramatic increases in supply, given that land is scarce in Asia.

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• Japan, the world's second-largest economy, now imports 60 percent of its food, and many worry about future food security if climate change rocks global food supplies or energy costs swing international grain prices.
• About 3,800 square kilometres (1,520 square miles) of farmland have been abandoned and laid waste throughout the nation. In 88 percent of cases, the owners said they were too old to work the fields.
• Japan, which kept its food self-sufficiency ratio above 70 percent in the late 1960s, now produces only 40 percent of its food and buys almost all its wheat, corn and soy beans from overseas.
• Domestic production of meat, particularly beef and pork, has fallen from 96 percent in 1960 to about half in 2007.
• The country grows enough rice for domestic consumption, thanks to heavy trade protection which has also made the rice sector highly inefficient.

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