"How have we not run out of grain?"

  

Erik Anderson asked to a room of nearly 100 TEGMA members, at the 2011 Annual Meeting. Anderson, current CEO of Louis Dreyfus North America, spoke on global consumption vs. population growth referencing 17th century philosopher, Malthus in his presentation Thursday morning.

  

Anderson began by explaining Malthus's quandary: If population is exponential and production is linear, worldwide we will eventually run out of food. With finite land resources, and a global decrease in grain reserves, the grain industry worldwide must now look to new ideas of how to feed its population.

  

As a whole, the world has increased their meat consumption. With the increase of meat consumption, we see an increase in grain consumption. However, we all have become more efficient in our meat consumption by consuming more chicken and pork, which overall is a decrease in grain consumption. With more meat growth, we see an increase in grain consumption and ultimately money for U.S. grain houses.

  

"The world is increasingly reliant on food produced thousands of miles away," says Anderson.

  

Gone are the days of grain reserves. With global stocks down, farmers are looking to increase yields to make up for the demand in the market. Policy has to shift from encouraging demand, to encouraging supply. However, in the free market, government intervention seems to be working against the goal.

"Government intervention either limits supply or increases demand, both of which work against free market solutions," Anderson says.

  

Anderson stated that by 2050, the worldwide population will be nearly 9.2 billion. In order to continually feed the increased population by that point, the world will need to find another 6% in worldwide acreage, according to Anderson, which will be approximately all the land west of the Mississippi. The question of where we will find that kind of land on a globe with finite resources is indeed disturbing.

  

With increased environmental regulations and infrastructure problems, it is getting increasingly harder to find virgin land. We have lost 25 million acres in the US alone due to these factors or abandoned land that has been lost to low yields, located in high risk areas, or land which has not been profitable at current price.

  

Not to mention in a global grain shortage, the U.S. continues in its quest to produce corn-based ethanol. "And in such a shortage, should we really be turning food into fuel?" questions Anderson.

  

Regardless, Anderson states, we should be encouraging higher prices to increase overall production.