have you designed your garden , Yet?

[Lamumba]

The Real Crisis That Will Soon Hit the US
Sunday, February 20, 2011 6:06
by Phoenix Capital Research

Forget stocks, the real crisis is coming and it’s coming fast.

Indeed, it first hit in 2008 though it was almost entirely off the radar
of
the American public. While all eyes were glued to the carnage in the
stock
market and brokerage account balances, a far more serious crisis began to
unfold rocking 30 countries around the globe.

I'm talking about food shortages.

Aside from a few rice shortages that were induced by export restrictions
in
Asia, food received little or no coverage from the financial media in
2008.
Yet, food shortages started riots in over 30 countries worldwide. In
Egypt
people were actually stabbing each other while standing in line for
bread.

We’re now seeing the second round of this disaster occurring in Egypt and
other Arab countries today. Thanks to the Fed’s funny money policies,
food
prices have hit records. And even the Fed’s phony measures show that
vegetable prices are up 13%!

The developed world, most notably the US, has been relatively immune to
these developments… so far. But for much of the developing world, in
which
food and basic expenses consumer 50% of incomes, any rise in food prices
can
have catastrophic consequences.

And that’s not to say that food shortages can’t hit the developed world
either.

According to Mark McLoran of Agro-Terra, the Earth’s population is
currently
growing by 70-80 million people per year. Between 2000 and 2012, the
earth’s
population will jump from six billion to seven billion. We’re expected to
add another billion people by 2024. So demanding for food is growing… and
it’s growing fast.

However, supply is falling. Up until the 1960s, mankind dealt with
increased
food demand by increasing farmland. However, starting in the ‘60s we
began
trying to meet demand by increasing yield via fertilizers, irrigation,
and
better seed. It worked for a while (McLoran notes that between 1975 and
1986
yields for wheat and rice rose 32% and 51% respectively).

However, in the last two decades, these techniques have stopped producing
increased yields due to their deleterious effects: you can’t spray
fertilizer and irrigate fields ad infinitum without damaging the land,
which
reduces yields. McLoran points out that from 1970 to 1990, global average
aggregate yield grew by 2.2% a year. It has since declined to only 1.1% a
year. And it’s expected to fall even further this decade.

Thus, since the ‘60s we’ve added roughly three billion people to the
planet.
But we’ve actually seen a decrease in food output. Indeed, worldwide
arable
land per person has essentially halved from 0.42 hectares per person in
1961
to 0.23 hectares per person in 2002.

It’s also worth noting that diets have changed dramatically in the last
30
years.

For example, in 1985 the average Chinese consumer ate 44 pounds of meat
per
year. Today, it’s more than doubled to 110 pounds. That in of itself is
impressive, but when you consider that it takes 17 pounds of grain to
generate one pound of beef, you begin to see how grain demand can rise
exponentially to population growth with even modest changes to diet.

Make no mistake, agriculture is at the beginning of a major multi-year
bull
market. We’ve got rapidly growing demand, reduced production, and decade
low
inventories.
--
Karma, What a concept!