Tag Archives: food
Global Food Prices Expected To Remain Volatile In Coming Years, Warns UN Official
New York, Oct 8 (IBNS): Although global food prices have recently stabilized, they are expected to remain volatile over the next few years, the head of the United Nations Food and Agriculture Organization (FAO) said Monday, as a ministerial meeting on global food prices kicked off in Rome. FAO Director-General José Graziano da Silva told the meeting, which coincided with the opening of the Committee on World Food Security, that this year’s session was taking place in a less troubled climate than a year ago, when the ministers came together in response to the third spike in international grain prices in five years. “The outlook for international food commodity markets finally looks calmer this year,” he told the meeting, which was attended by some 30 agriculture ministers. “Grain production has rebounded and higher stock-to-use ratios should bring greater stability to prices.” And while the FAO Cereal Price Index is 20 per cent lower than it was one year ago, this is not the time for complacency, he stated. “International prices have declined but they are still above their historical levels. And prices are expected to remain volatile over the next years,” he warned. Graziano da Silva urged countries to take advantage of the relative calm to prepare for future market turbulence and find lasting solutions to the issues surrounding food price volatility. “If higher and volatile prices are here to stay, then we need to adapt to this new pattern.” The two critical issues for countries to address are how to help poor small-scale farmers benefit from the higher food prices, and how to protect low-income families who suffer as a result of them, he said. “The current situation offers an opportunity for farmers to reinvest in agriculture,” he continued, calling for a right set of policies to ensure that small-scale farmers have the means to take advantage of it. The Committee on World Food Security (CFS), which runs until Oct 11, opened Monday amid urgent calls to build more effective links between international policies and the daily needs of millions of the world’s most vulnerable people. “The latest estimates signal there are nearly 30 million less hungry people in the world in 2013, compared to last year,” Graziano da Silva said at the opening. “And we continue to progress towards achieving the Millennium Development Goal hunger target of reducing by half the proportion of the undernourished population between 1990 and 2015. “I see many challenges ahead of us, but also progress and successful experiences that we can build on,” he added. “We are convinced that working together is the only way forward.” “Poverty and hunger go hand-in-hand and poverty runs deepest in rural areas,” said Kanayo F. Nwanze, President of the International Fund for Agricultural Development (IFAD). “Let us not forget that rural areas are a key element of any new development agenda and global food security. Let us not forget that investing in smallholder agriculture is the most cost effective way for developing countries to tackle poverty and hunger.” Ertharin Cousin, Executive Director of the World Food Programme (WFP), said the world needs a strong and effective CFS. “Together, we shoulder an enormous responsibility, but our burdens weigh nothing in comparison to the suffering of the 840 million chronically undernourished people depending on us to get it right.” In a message delivered by his Special Representative for Food Security and Nutrition, David Nabarro, Secretary-General Ban Ki-moon called the Committee “the point of reference” for all who seek to achieve the goal of eliminating hunger through collaboration with governments, social movements, farmers’ organizations, business and the research community. “Working with a spirit of trust and mutual accountability, multiple actors are collaborating to address some of the thorniest issues of food security: land tenure; climate change; food price volatility; biofuels; and responsible investment in agriculture,” he noted. The weeklong session will feature two round tables: on biofuels and food security, and investing in smallholder agriculture for food security and nutrition. Continue reading
Carbon-Free NZ: Mass Biofuel Production
4:10 PM Wednesday Oct 2, 2013 EXPAND The Bioenergy Strategy indicates that 30% of our transport fuels could come from biomass by 2040; Scion research has shown that, long-term, we could theoretically do 100% New Zealand is in the enviable position of potentially becoming the Saudi Arabia of biofuels in the South Pacific, without the food Vs energy debate over biofuels that has plagued other nations. New Zealand has the capacity to produce all its transport fuels from indigenous natural resources. As petroleum becomes more expensive over the next decade we can transition to transport fuels from biomass (organic matter) and waste. Technically these are achievable now, but the economics are not quite there. Internationally there are a number of technologies available to convert biomass and organic matter into liquid biofuels. Some of these have been around for decades while others are emerging (including from pioneering New Zealand companies). Unlike many countries where the focus has been on the production of ethanol from sugar crops and biodiesel from vegetable oil, we can use our cropping land for more valuable products, such as food. The New Zealand focus for biofuel production is on using our biomass from wood and organic matter from municipal waste. As a result we will not have the food Vs energy problems. Instead, in New Zealand, it’s food plus energy. Transport fuel production from renewable sources is not new to us. Anchor Ethanol has been producing ethanol from whey for a number of years. The ethanol can be blended with petrol as Gull currently does. The production of biodiesel initially focused on using the feedstocks tallow, used cooking oil or canola oil, with conventional conversion technologies. For a short period biodiesel production was supported by financial assistance from Government which stimulated fleet owners to successfully trial biodiesel. Demand for biodiesel outstripped supply. However, because of the short term of the assistance, investors stayed clear of building new production capacity. Now only Green Fuels NZ, who purchased the biodiesel production business from Solid Energy, produce biodiesel commercially. The experience of biodiesel showed the significant international marketing benefits that are achievable for NZ Inc when we seriously use biofuels in vehicles. Many tourist businesses, such as in Queenstown where all tourist operators used biodiesel, gained significant market advantage from being able to promote themselves as ‘clean and green’. This carries over into our export businesses where sustainable production is becoming more important to customers. This initial biodiesel and ethanol production was always going to be limited, but its importance with regard to transitioning to greater volumes of production was in the experience vehicle owners gained in the use of biofuels. However, there would have been enough feedstock for conventional technologies to have provided adequate quantities of biofuel until the economics of advanced biofuels occurred. The emerging biofuel production of greatest relevance to New Zealand uses advanced technologies and feedstocks of biomass or waste organic matter. These are not the most attractive feedstocks as they are low in sugars and starches. We have a lot of biomass and we are good at growing it, and we have an endless supply of organic matter in municipal waste. In fact, municipal waste costs us money to dispose of. Commercial facilities producing these biofuels are currently starting in many countries. They generally require government subsidies – the level of which gives an indication of just how close the technologies are from operating in an unsubsidised market such as ours. Taking into account petroleum price projections. I estimate we are only 5-10 years off being fully commercial. We currently waste 10-15% of our forest production through harvesting and processing. This quantity of wood residue would be enough to get biofuel production started using advanced technologies. This would promote larger quantities of biomass from extended forest planting. The Bioenergy Strategy prepared by the Bioenergy Association indicated that 30% of our transport fuels could come from biomass by 2040. Scion research has shown that, long-term, we could theoretically do 100%. The economics of this sort of production is likely to be carried through by the value of the co-products that are also extracted during the process. Wood and other organic matter is rich in chemicals, only some of which can be used to make biofuels, and these chemicals will become more valuable as petroleum prices soar. The chemicals from wood can also be used to make bio-plastics which can substitute petroleum-based plastics. Consolidation of the current sector, based around the production of transport biofuels and their co-products, along with our ability to efficiently grow wood, could lead to our working with Asian countries such as Singapore, which does not have enough land to grow wood for production of liquid fuels and bio-based materials. The demand for liquid fuels for transport and other uses is unlikely to disappear, but the price will escalate. Now is the time to start partnering with Asian countries so that we use their money, and our ability to efficiently grow wood, to produce their liquid biofuels. New Zealand could become the Saudi Arabia of the region in the production of biofuels. For weekly Element news sign up for our newsletter here Brian Cox is the executive officer of the Bioenergy Association of New Zealand. He has over 30 years’ experience in identifying, investigating and developing commercial capital investment projects in the energy and infrastructure sectors. The Association represents all commercial, research and academic parties involved with wood fuel, biogas and liquid biofuels. Previously Cox led the development of the New Zealand Bioenergy Strategy (which he now works to implement) which has been recognised within the Government’s Energy Strategy. By Brian Cox Continue reading
Global Farmland Offers Potential For Asset Deals
As the world’s population swells beyond seven billion and emerging markets’ appetite for food grows, Canadian institutions are getting increasingly hungry for agribusiness and farmland acquisitions abroad. Canada’s pension funds have long been putting their money into mining, energy and infrastructure, and more recently luxury retail brands, but now many are snapping up swathes of arable land or creating special investment vehicles to explore opportunities in agriculture. “We’ve seen this uptick in interest in investing in agricultural assets, and, I think the growing importance of food production overall in the world,” says Grant Jameson, who heads up the Canadian agribusiness practice at Norton Rose Fulbright. Canadian institutions, tired of the lacklustre returns in the market, are seeking options with better yields than gold and government bonds, such as agriculture, experts say. As the global standard of living rises, so too does consumer desire for different and fresher types of food, says Jeff Barnes, a partner at Borden Ladner Gervais LLP in Toronto. “As people get more flush, one of the small luxuries is to look a little wider for their food. And that’s going to feed agribusiness.” This year, Canada Pension Plan Investment Board launched its agriculture investment program, and made its first direct farmland investment in a portfolio of U.S. farmland. “These assets have historically delivered stable risk-adjusted returns but, more importantly, the outlook in the global agricultural market in the coming decades is positive due to increasing demand for a wide variety of agricultural products as populations and incomes rise in emerging economies,” CPP’s 2013 annual report states. CPP’s initial focus will be the U.S., Canada, Australia and New Zealand, it added. Meanwhile, the Ontario Teachers’ Pension Fund at the beginning of this year created a “natural resources” investment asset class. Teachers says it will look for “new opportunities in oil and gas and agriculture.” Last year, Caisse de dépôt et placement du Québec and British Columbia Investment Management Corp. joined with U.S. financial services company TIAA-CREF to create a global agriculture investment vehicle, with $2-billion earmarked to buy farmland in the U.S., Australia and Brazil. In 2011, Alberta Investment Management Corp (AIMCo), joined a forestry management firm in a $415-million acquisition of Australian timberlands — options for which chief executive Leo de Bever said included reverting it to agriculture. Farmland, with its steadily rising prices, is a tantalizing investment option – and one that provides interim income by leasing it to agricultural operations, says Mr. Barnes. “From the point of view of the investor, you are buying the land and you’re leasing it back to a farmer so you’re getting current yield,” he says. “The long-term bet is that this is an asset that people believe will be extraordinary in terms of how much it increases in value.” Canadian farmland values have risen steadily over the last decade, according to Farm Credit Canada, but spiked last year. During the second half of 2012, prices on average rose 10%, which is the highest since the organization began tracking farmland prices in 1985. The cost of farmland across the country in 2013 is at record highs, according to real estate firm RE/MAX, with low inventory pushing up supply in 15 out of the 17 rural markets it tracks. The greatest upswings were in Saskatchewan and Alberta. For example, the price per acre in east central Saskatchewan was $850-$2,500 in 2013, up from $650-$1,250 just two years earlier, RE/MAX said. The price hikes in southwestern Ontario have been particularly steep, according to farmland appraiser Valco. The average rate of increase over 10 counties has been roughly 25% per year since 2010. Land can cost upwards of $15,000 per acre. Farmland values across the globe between 2002 and 2010 have risen up to 1,800%, according to the Global Farmland Index compiled by U.K.-based real estate firm Savil. The biggest upswings have been in emerging markets, such as Romania and Hungary, it said. But the fact that prices have escalated so rapidly is a problem for potential investors, says AIMCo’s Mr. de Bever. He wonders whether the investment potential for farmland has run its course. He explains that the rationale for investing in land is that, with rising demand for protein in the Far East, existing landstock will become more valuable. Yet he points out that land values operate on a long cycle, and that the recent run up in value has been compressed into a short timeframe. “It’s not clear to me that any increase in farm prices is going to be rewarded with an appropriate return.” Still, Mr. de Bever says AIMCO, and other investors, will keep an eye out for farmland acquisitions — albeit a cautious one. “My guess is that there is still going to be quite a bit of demand. My concern is that I would be very picky and make sure that you’re buying right.” Mr. Barnes expects Saskatchewan to remain attractive, where land parcels are larger and the prices are a bit better. Australia remains attractive too, given the similarity in governing structures, compared to places with more instability such as Africa, he says. Other factors that will influence future demand include the trend of using technology to convert unsuitable land into arable land, in parts of South America, Mr. de Bever says. Some parts of Africa will emerge as better investment possibilities once they stabilize politically. “It is one of the areas where you will for the next while see a lot of growth,” Mr. Barnes says. “Whether it will be ticked with pluses and minuses, I don’t know. But it’s certainly an area that is very much in the front of peoples’ minds, especially since other hard commodities like metals are not so much in the front of their mind right now.” Financial Post Continue reading
