This week's Economist has a story on the value of land and its relationship to our ability to grow enough food to feed future populations. The article starts off this way:
IN THE next 40 years, humans will need to produce more food than they did in the previous 10,000 put together. But with sprawling cities gobbling up arable land, agricultural productivity gains decreasing, and demand for biofuels increasing, supply is not keeping up with demand. Clever farmers, scientists and entrepreneurs are bursting with ideas. But they need money to make this jump.So, demography is key here in two ways--population pressure on the food supply, and the aging of farmers in the more developed countries. But what about that blockbuster first sentence? Is it really true that "in the next 40 years, humans will need to produce more food than they did in the previous 10,000 put together."? Before making my own back of the envelope calculations, I checked the comments on the story to see if anyone had questioned this claim. No one had--all who commented apparently accepted it is as fact.
Financiers more often found buying and selling companies have cottoned on to the opportunity. Farm gates have traditionally been closed to capital markets: nine in ten farms are held by families. But demography is forcing a shift: the average age of farmers in Europe, America and New Zealand is now in the late fifties. They often have no successor, because offspring do not want to farm or cannot afford to buy out family members. In addition, adopting new technologies and farming at ever-greater scale require the sort of capital few farmers have, even after years of bumper crop prices.
The calculation is pretty straightforward: average population per year times average calories per day times days per year times the number of years in question:
For the next 40 years, the average projected population by the UN Population Division is 8.7 billion per year. In Table 11.3 of the 12th edition I provide data from the FAO showing that the average food consumption in the world is about 2,830 calories per day. Assuming those numbers, we get a demand figure of 3.6E+17 for the next 40 years. For the past 10,000 years we obviously know less. Looking at Figure 2.2 in the 12th edition we can make a rough calculation that the average world population over the past 10,000 years was 100 million (going from 4 million in -8000 to 7.3 billion in 2014). Even if we assume a desperation level diet of 1,500 calories per day year per person, that produces a demand figure of 5.5E+17--well above the figure for the next 40 years. So, I'm not sure where the numbers come from for that beginning sentence. At the same time, this does not diminish the task at hand, and it is my guess that investors buying land for the purpose of making money, rather than growing food, is not likely to end well.
I note that the Economist Group is hosting a conference on "Feeding the World 2015" in Amsterdam in February. Perhaps we will have more insight after that.