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Food Supply Will Meet Demand

May 30, 2008
The UN Food and Agriculture Organization (FAO) and OECD released their annual Agricultural Outlook yesterday. It makes a strong case for increasing global agricultural production by increasing yield on existing acres – one of many solutions biotech can help provide.

  • Adverse weather conditions in major grain-producing regions, coupled with low stocks, were enough to trigger the current sharp rises in food prices even if all other factors were equal.

  • Productivity gains from increased yields will eventually meet and exceed the growing demand for food, feed, fiber and biofuels.

  • Continued growth in yields will be a more important factor in meeting demand than increased use of land for agriculture.

  • Food and feed remain the largest sources of demand growth in agriculture, not biofuels.

The report also credits new technological developments – such as cellulosic biofuels – with the possibility that we could reduce world food prices in the future, but also points out that these technological developments are not considered in the current projections.

How the world can boost agricultural output without increasing land use is a challenge that U.S. Agriculture Secretary Ed Schafer will address when he travels to the UN High-Level Conference on World Food Security: the Challenges of Climate Change and Bioenergy in Rome next week. His agenda for the meeting will include support for increased adoption of and reduced trade barriers for agricultural biotechnology. At a briefing for reporters, he noted:
The United States will propose that all countries consider strategies that expand research, promote science-based regulations, and encourage innovative technology -- including biotechnology…. 

“I will be hosting a side event focused on new technologies to showcase developing countries that have moved forward with public investment in adoption of bioengineered products….

“According to our [White House Council of Economic Advisors] analysis, the increased biofuels production accounts for only 2 to 3 percent of overall increase in global food prices. At the same time, the International Energy Agency reports that biofuels production over the past three years has cut the consumption of crude oil by 1 million barrels a day. Biofuels are helping address both environmental concerns and the economic impacts of high oil prices.”

The IEA perspective on biofuels mentioned by Schafer is well worth reading. It says in part:
Biofuels are playing an increasingly important role in meeting growing transport fuel demand. They represented 49% of the growth in Non-OPEC oil supply in 2007 and this share is expected to rise to 55% in 2008.”