November 20, 2014 Sovereign Valley Farm, Chile
As we discussed yesterday, the world has certainly gotten itself into a serious pickle.
World population growth and economic trends are causing food demand to soar.
Demographers tell us that over 200,000 people will be present at the dinner table tonight who weren’t even alive yesterday.
And with over a billion people having been lifted out of poverty in the developing world (and more to follow), people are eating more food (and more resource intensive foods like meat) than ever before.
At the same time, farm yields have peaked in the developed world. Science has managed to extract from the ground as much as the earth can give.
Many farmers are quitting the business altogether thanks to rising input costs and absurd regulation, and the amount of farmland is in clear decline.
The arithmetic here is quite simple: the demand for food Calories is rising while the ability to provide those food Calories is falling.
This suggests rising food prices over the long-term, and potentially even shortages.
But behind this uncomfortable data is a clear opportunity: if demand for food is increasing while the supply of farmland is in decline, then high quality farmland is an obvious asset to own.
The question is: where? Not all farmland is created equal.
In fact, much of the farmland in the developed West is already at or near an all-time high, and much of it lacks available water.
This post was published at Sovereign Man on November 20, 2014.