Contact Us
Firm Overview
Why Legend Is Different
Client Types
Professional Biographies
Frequently & Rarely Asked Questions
Risk Spectrum
Investment Strategies
Second Opinion
Global Investment Pulse
Event Calendar
Press Center
Legend News
Clients Only
Career Opportunities
Directions
Newsletter Sign-up
Site Search
Site Map
Home
Tell A Friend About This Website
 
 
 
Informational Booklets   

 

Phone: (412) 635-9210
  (888) 236-5960
Connect With Legend:
Subscribe to me on YouTube

Emerging Market Food Consumption Growth Equals Rising Prices

    

The world population, especially in emerging market and pre-emerging market or frontier market countries, is getting richer.  The first thing everyone is buying isn't a new Mercedes or Rolex watch, they're buying food.  According to Chinadaily.com, more than 200 million Chinese, or 23% of the population, are officially overweight.  Nearly 60 million of those individuals are officially classified as obese.  

 

Worldwide food demand is growing.  Continued economic growth around the world is only going to spur more and more food demand.  Once the growth in the world population is added to the mix, this could be the investment opportunity of a lifetime cropping up (pardon the pun) in the agricultural industry.

 

Currently, the world population is about 6.6 million people.  By 2030, it is projected to reach a total of 8.2 billion people.  Although that's approximately 24% growth in total, normally it is not anything to be excited about. 

 

However, not only will there be more people to feed, but those people are eating more and more.  Currently, the average amount of food eaten per person is 2,600 calories per day.  However, those living in developed parts of the Western world, like the U.S. and Europe, consume approximately 3,200 calories per day.  In the eastern hemisphere, the Japanese eat approximately the same amount of calories.  

 

Thanks to improving developing economies, the average caloric intake is expected to be approximately 3,000 calories per day by 2030.  Once again, moving from 2,600 to 3,000 calories per day is only a 15% increase.  Spread out over 23 years that may not seem like a big increase, but it is a big increase for a world that cannot currently produce enough food.  

 

For instance, more than 60% of Beijingers are overweight and the percentage of the population in this category is growing by the day.  That growth is pushing the global food supply-demand situation, which is already very tight, further into imbalance. 

 

With unexciting numbers like these, it's no wonder the world hasn't caught on to how big growth in the agricultural industry will be.  That's only one of the major trends.  

 

The other alarming trend is that the world is moving into cities.  This trend, coupled with a growing demand for food, will only continue to increase.  According to the United Nations, 2007 marks the first year in history where cities have more people than rural communities.  Presently, more than 50% of the world lives in townhouses, apartments and other urban housing structures.  

 

How big is this phenomenon?  Consider that only 13% of the world's population lived in cities in 1900.  That surged to 29% in 1950.  In 2005, 49% of the world's population lived in urban centers.  It won't be long until 55%, then 60%, then 65% of the world's population lives in cities.  Urbanizing populations have a staggering effect on the world, but its impact is greatest in the agriculture industry.  A great deal of activity takes place in cities, such as manufacturing, shipping, research, education and technological development.  But one thing that doesn't exist there is farming.  There's just not enough land available in cities to allow farms to perpetuate.  As a result, an urbanizing population demands more and more food without the wherewithal to produce it.  While we don’t expect a Soylent Green apocalypse scenario (named after the famous movie from the early 1970s—just in case you are wondering about it, Charlton Heston and Edward G. Robinson starred), food lines in some countries’ cities could be commonplace. 

 

The world is getting richer, moving into cities, and eating more, with the BRIC (Brazil, Russia, India and China) countries serving as just a few examples.  The global agriculture boom is still in the very early stages.  We expect the growth of food prices to continue for the next several decades.

 

 

Source: Many of the figures mentioned in this article were obtained from the article entitled “Global Agriculture Boom Has Just Begun Only…” by Andrew Mickey/Commodity Online, published on December 13, 2007 on www.rediff.com. 



INDEX
  • Six Tax Items For Small Businesses
  • Now Is A Perfect Time To Open A New Business
  • Do You Know If Your Business Really Is Small?
  • 4 Estate Issues For Business Owners
  • Self-Employed? Map Out Tax Details
  • 10 Easy Steps To Take If Opening A New Business
  • To Buy Or Not To Buy: That Is The Business Franchise Question
  • Ever Considered Helping Your Adult Child Open A Business?
  • Do You Know What Kind Of Business Not To Open?
  • Do You Plan To Move Your Business To A New State?
  • Dispel These 7 Popular Myths About Retirement
  • 4 Retirement Plan Options For Your Small Business
  • Are Stocks Overpriced And Forming A Bubble?
  • 4 Steps To Creating A Dynamic Business Budget
  • Can An Underfunded Small Business Startup Be Successful?
  • What Happens If You Have Excess Capital Losses?
  • This Is Not Granddad's 'Defined Benefit Plan'
  • Despite Much Pessimism, Slow Growth Persists
  • How To Take Your Section 179 Deduction To The Max
  • Squeeze More Out Of Bonus Depreciation Deductions
  • A Common Error In Powers Of Attorney
  • For The Self-Employed: 4 Retirement Plan Choices
  • Which States Are The Most Friendly To Businesses?
  • How Economic Myths Distort Investment Outlook
  • Don't Forget About Roth 401(k)
  • REITs: A Great Diversification Investment
  • Shopping For A Bank Account That Pays The Highest Possible Rate Of Interest
  • The Twenty Top Tax Breaks In The New 2010 Tax Act
  • Investing Defensivley Does Not Mean Deserting Stocks
  • 401(k) Alternatives For Business Owners
  • Tax Court Okays Deducting Cost Of MBA
  • Employers Find Ways To Mitigate Liability On 401(k)s
  • Working Longer: What's A Post-Retirement Job Worth?
  • Slash Taxes By Swapping Like-Kind Assets
  • Transferring The Family Business To Your Heirs
  • Business Owners Get Big Tax Cuts In Recovery Act
  • Move Fast To Corral Emergency SBA Loans
  • Risk Management
  • Estate Taxes And The Obama Administration
  • Gifting A Business Can Cut Estate Taxes
  • A Little Bond Logic Yields Insights
  • Avoiding The IRA Rollover Crackdown
  • Ruling Cites Business Owner Responsibility to 401 (k) Plans
  • Ruling Cites Business Owner Responsibility to 401(k) Plans
  • How Much Is Your Business Worth?
  • Managing Cash Flow In Tight Times
  • When Times Are So Scary, Opportunities Emerge
  • Avoid Being Accused Of Insider Trading
  • Lifecycle Funds May Pose A Hidden Danger
  • Funding A Friend's Business Venture
  • Beware Of Social Security Identity Theft
  • Regulatory Guidelines Update
  • Small Business And Work Opportunity Tax Act
  • The Oil Patch Profit Squeeze
  • Free Credit Reports Available Online
  • Understanding the Importance of a Fiduciary Standard
  • Energy Systems Scale and Timeline
  • Timber As A Liquid Investment
  • Timber Facts
  • Emerging Market Food Consumption Growth Equals Rising Prices
  • Bank Loan Funds - A Primer
  • Ethanol: Salvation or Panacea?
  • Emerging Market Food Consumption Growth Equals Rising Prices
  • A Primer On Managed Futures
  • Identity Theft: What Documents Should You Shred Or Store?
  • The Case For Industrial Metals
  • Total Credit Market Debt (All Sectors) As % Of U.S. GDP
  • Know The Score
  • REITS: A Very Good Portfolio Diversifier, But Should You Invest In Them?
  • Does Investing Internationally Still Diversify Your Portfolio
  • Another Way To View The Current Valuation Of REIT Sector
  • Understanding Risk-Preparing For The Unseen
  • Bank Loan Funds: A Great Fixed Income Investment As Interest Rates Rise
  • What Is Shorting Expense?
  • How Dangerous Is A Dollar Crash?
  • How Volatile Can The Stock Market Be?
  • GMO 7-Year Asset Class Return Forecast Is Bleak
  • Too Many ''Phish'' In The Sea
  • Identity Theft In The New Year
  • Ways To Improve The Score
  • To Reinvest Or Not To Reinvest
  • Why Not Alternative Fixed Income Investments?
  • Just How Expensive Is The Market?
  • Beware of Brokerage Firms' Misconduct
  • Identity Theft : Correct Those Credit Reporting Errors
  • Risk-Controlled Investing
  • Q & A With Robert Arnott
  • Identity Theft : Applying For Credit? Better Check Your Credit Report First
  • Identity Theft: Everyday Prevention
  • Identity Theft : Help Is On Its Way
  • Identity Theft: Tips To Protect Yourself
  • Identity Theft : Don't Fall For That E-Mail!
  • Identity Theft : One More Reason To Protect Your Credit
  • Identity Theft: A Note About Social Security Numbers
  • What Do Rising Interest Rates Mean For Money Market Yields?
  • Exit Gracefully: How Business Owners Should Plan For A Comfortable Retirement
  • Section 529 Plans Are Popular But Not The Only Way To Go
  • The Importance Of Commodities In A Portfolio
  • A Tale Of Two Hedges
  • IRS Refuses Change Of Section 179 Election To Expense Depreciable Property
  • Small Businesses Need To Be Aggressive On Costs
  • Your Medical File Report May Need A Check-Up
  • Do It Yourself Tax Preparers Watch Out: Tax Answers From IRS Centers Oftentimes Are Incorrect And/Or Insufficient
  • Home Office Deductions: Hoops To Jump Through
  • Property Tax Challenges Should Not Be Overlooked
  • The IRS Will Follow Your Wealth To The Ends Of The Earth
  • Year-End Tax Defferal Planning
  • How To Find A Great Financial Advisor
  • Is It Time To Find A New Financial Advisor?
  • What Is Risk?
  • 4 Steps To A More Secure Investment Portfolio For Your Retirement
  • Traditional Investing May Decrease Your Retirement Lifestyle
  • Year-End Tax Planning Can Help Generate High Return On Investment
  • Businesses Receive Temporary Depreciation Bonus
  • Understanding Deflation
  • Is Your 401(k) Plan A Failure?
  • Succession Planning: Developing A Plan For Your Business
  • The ERISA Retirement Plan Law Spells Out Fiduciary Issues
  • Evaluating The Quality Of A Company's Earnings
  • Investing In Times Of Uncertainty And Risk: The Importance Of Diversification
  • Tax Issues To Consider When Buying A Long-Term Care Policy
  • Yesterday's Great Companies
  • Businesses Should Be Aware Of States' Use Taxes
  • Expanded Retirement Plan Contribution Limits Create New Opportunities For Business Owners
  • Succession Planning: Developing A Plan For Your Business



  • ©2017 Legend Financial Advisors, Inc.®. All rights reserved.