Long-Term World Acreage Response and Food Prices · Department of Agricultural Economics Purdue...
Transcript of Long-Term World Acreage Response and Food Prices · Department of Agricultural Economics Purdue...
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Department of Agricultural Economics Purdue University
Long-Term World Acreage Response and Food Prices
Chris Hurt Purdue Extension Service
November 2012, [email protected]
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Department of Agricultural Economics Purdue University
https://www.farmfoundation.org/searchresults.aspx?pno=1&st=food prices
WHAT IS DRIVING FOOD COMMODITY PRICES?
Purdue studies with Farm Foundation: 2008, 2009 and 2011
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Department of Agricultural Economics Purdue University
Agricultural Booms are led by Unexpected Demand Surges that often have a Macro Economic influence, and come after a period of weak supply growth
Agricultural Bust are led by the failure of the demand surges to continue, by reversal of macro-economic factors, and by a surprisingly large supply response to high agricultural prices
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Department of Agricultural Economics Purdue University
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Department of Agricultural Economics Purdue University
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Department of Agricultural Economics Purdue University
5.0 4.1
7.4 9.0
10.3
8.3 9.9
12.1
17.3 18.8
21.1 20.9 20.4
3.3 3.7
5.6 5.9 6.0
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23.8 24.6
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1.4 0.8
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Mill
ion
Acre
s
Crop Year
Acres of U.S. Soybeans Exported to China; Acres of Corn to Ethanol(ddgs adjusted); Acres of Corn Exported to China
Bean Acres to ChinaCorn Acres to EthanolCorn Acres to China
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Department of Agricultural Economics Purdue University
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022Biomass-based Diesel 0.5 0.65 0.8 1 1 1 1 1 1 1 1 1 1 1Non-celulosic Advanced 0.1 0.2 0.3 0.5 0.75 1 1.5 2 2.5 3 3.5 3.5 3.5 4Celulosic Advanced 0.1 0.25 0.5 1 1.75 3 4.25 5.5 7 8.5 10.5 13.5 16Conventional Biofuels 4 4.7 9 10.5 12 12.6 13.2 13.8 14.4 15 15 15 15 15 15 15 15
0
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35
Bill
ions
of G
allo
ns
Renewable Fuel Standard (2007-2022)
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Department of Agricultural Economics Purdue University
8.4 7.8
13.0 14.9 16.3 16.1
20.2
26.6
34.6
39.2
45.1 46.9 47.9
0
5
10
15
20
25
30
35
40
45
50M
illio
n Ac
res
U.S. Acres Required for Chinese Soybean Exports; Ethanol (ddgs adjusted); and Chinese Corn Purchases
1.9M acre/year
5.8M acre/year
1.4M acre/year
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Department of Agricultural Economics Purdue University
7% 6%
10% 12%
14% 12%
13%
19%
23% 25%
28% 28% 27%
5% 5% 8% 8% 8%
10%
15% 17%
22%
25%
29.2% 29.3% 30%
0%
5%
10%
15%
20%
25%
30%
% of U.S. Harvested Acres: Corn to Ethanol and Beans to China
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Department of Agricultural Economics Purdue University
Picture: Michigan State University
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Department of Agricultural Economics Purdue University
1972/73= 1,872
1981/82= 2,115
1996/07= 2,104
2002= 2,033
1,600
1,700
1,800
1,900
2,000
2,100
2,200M
illio
n World Harvested ACRES 13 Major Crops Total: (Millions)
71 Million acres reduction in 6 years
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Department of Agricultural Economics Purdue University
1972/73= 1,872
1981/82= 2,115
1996/07= 2,104
2002= 2,033
2005/06= 2,144
2012/13= 2,267
1,600
1,700
1,800
1,900
2,000
2,100
2,200
2,300
2,400M
illio
n World Harvested ACRES 13 Major Crops Total: (Millions)
123 Million acres added in 7 years
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Department of Agricultural Economics Purdue University
Buying farmland abroad Outsourcing's third wave Rich food importers are acquiring vast tracts of poor countries' farmland. Is this beneficial foreign investment or neocolonialism? The Economist: May 21, 2009
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Department of Agricultural Economics Purdue University
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Department of Agricultural Economics Purdue University
71.0
33.7
14.7 14.6 8.1 6.2
0.8
-0.6 -2.1 -3.0 -3.1 -6.0 -11.0 -20
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CR
ES
Change in World Harvested Area 2012/13 vs. 2005/06 (Million
Acres)
-123 million new World Harvested Acres -About ½ of the non-hay U.S. crop acres
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Department of Agricultural Economics Purdue University
21.5
18.3 17.2
14.4
12.4
9.2 8.2
7.2 6.6
3.9 3.5 2.1 2.0 1.7 1.5 1.1 0.4
-0.2
-2.2
-2.2 -3.1 -5
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25By Country: Change in World Area of 13 Major Crops: 2012/13 vs.
2005/06 (Million Acres)
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Department of Agricultural Economics Purdue University
36.4
20.2 17.9 17.2 16.3
13.7
8.2 3.9
0.9
-2.5 -9.3
-20
-10
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illio
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Change by Region in Area Harvested in 13 major World crops 2012/13 vs. 2005/06 (Million Acres)Total +123 million acres
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Department of Agricultural Economics Purdue University
India Ag Export Rank: #7 in Wheat #4 in Soybean Meal #2 in Rice #1 in Beef
Global Supply Response is both: -Extensive -Intensive
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South America Dominates Soybean Production!
Department of Agricultural Economics Purdue University
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Billi
on B
u.
South America
U.S.
Area Production
Argentina 13% 34%
Brazil 10% 22%
S. America 11% 29%
Change from 2011/12 Crop
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Department of Agricultural Economics Purdue University
15.1%
14.6%
14.9%
18.9%
13.7%
10%12%14%16%18%20%22%24%26%28%30%32%34%36%
World Stocks to Use %: USDA May/Oct 2012 Wheat
Rice
Soybeans
Corn
Oct 12 May 2012
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Department of Agricultural Economics Purdue University