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Agriculture needs 'transformational change', World Bank guru says

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Global agriculture requires "transformational change" to meet the challenges of growing demand for food, at a time of increasing concern over greenhouse gases – of which it stands to be by far the biggest producer, World Bank expert Marc Sadler said.

Mr Sadler, adviser to the World Bank on agriculture risk and markets, underlined that demand for agricultural commodities was being spurred not just by a growing world population but, thanks to affluence, by the increasing demand for meat – which is relatively inefficient to produce.

"It takes a large amount of crop-based calories to produce a relatively small amount of meat based calories," Mr Sadler told Agrimoney LIVE in London, estimating at 76% the growth in in world meat consumption between 2005-07 and 2050.

The increasing demand for animal protein is in turn spurring growth in needs for feed grains, which while it "always used to be very much a backwater… is becoming increasingly important" as a driver of cereals demand and production dynamics.

Shrinking land base

However, the need to raise production was coming at a time of pressure on farmland area too, with farmers lacking the ability, as they have historically, to clear forest for agricultural output.

"We are going to have to produce more with far less land," Mr Sadler told the conference, in London.

Besides pressure from factors such as urbanisation, land use will be constrained too by climate change, which will see yields more than halve by 2050 in many parts of the world, including areas of Brazil, North Africa and western Australia.

'In for a large surprise'

While farmers have historically been able to adapt to shifts in their environments, now "the speed of change is going much faster than the ability of farmers to adapt".

Yield decreases will be evident in the likes of the US Midwest, And France too, although northern Europe, Canada's Prairies and much of the former Soviet Union is placed for large increases, on World Bank estimates.

Furthermore, agriculture, already a large producer of greenhouse gas emissions, stands to become by far the biggest producer – a factor likely to put it increasingly in the firing line for environmental curbs.

"If you do not think this is going to have regulatory impacts, then you will probably in for a large surprise," Mr Sadler said.

'Transformational change'

The pressures mean that agriculture "requires transformational change.

"It requires technology, a different way of thinking about what it produces", he said.

The change also creates a "business opportunity to get ahead of the regulatory curve", and beat the pressure of growing environmental red tape.

Already, many food companies, for instance, are "well ahead of" the US Environmental Protection Agency in compliance with regulations, often because the groups are global enterprises, meaning they have to clear environmental hurdles in a range of countries.

"The likes of General Mills, Cargill – there has been a fundamental shift in the way these companies do business.

"Businesses are already considering where they want to be in 20-30 years' time, and if they want to be involved with commodities more harmful than coal."

By Mike Verdin at Agrimoney LIVE

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