21 December 2011
The coming global battle for protein
The world is witnessing a tremendous change in eating habits with rising disposable income and economic growth especially in developing nations making people taste more of meat and poultry.
According to Food and Agriculture Organisation (FAO), an expanded world population will be consuming two thirds more animal protein than it does today, bringing new strains to bear on the planet’s natural resources. Meat consumption is projected to rise 73% by 2050, dairy consumption will grow 58% over current levels.
According to some analysts, India, the fifth largest producer of soybean after US, Brazil, Argentina and China accouting for 5% of global output, may become a net importer by 2015. This is due to rising domestic demand for meat consumption. India is a leading exporter of Soymeal and in the present crop year ending September, the nation exported 4.1 mn tonnes.
Among other Asian nations, Indonesia produces about 700,000 tonnes of soybeans annually which has not been sufficient to keep up with local demand of 2.4 mn tonnes, according to a Rabobank report. Bangladesh farmers have now taken a fancy for cultivation of Corn along with rice as it is being encouraged by the government to ensure feed supplies for the poultry and meet industry.
Soybean and corn cultivators may be going through a bad patch in USA due to recessionary trends in poultry industry and drop in exports. However, the long term looks positive for the industry as rising poultry, meat consumption.
Global soybean production is projected at 259.2 million tons, up 0.3 million in 2011-12. Increased production for Canada and India is only partly offset by a lower projection for China, according to US Department of Agriculture.
Global corn production for 2011-2012 is projected at a new record high of 867.5 million tons, despite a 3.5-million-ton decline year-to-year in the U.S. Foreign corn production is expected to be up 43.4 million tons from 2010-2011. China 2011-2012 production is raised 7.3 million tons this month based on the recently released estimate from the National Bureau of Statistics.
Since 1967, global production of poultry meat increased by around 700 percent. Other products saw surges in production as well, including eggs, which registered a 350 percent increase, pig meat (290%), sheep and goat meat (200%), beef and buffalo meat (180%) and milk (180%).
Livestock products today supply 12.9 percent of calories consumed worldwide — 20.3 percent in developed countries. Their contribution to protein consumption is estimated at 27.9 percent worldwide and 47.8 percent in developed countries. Compared to this, the other major source of protein, pulses, provides only 10% of protein requirements. The planted area would have to increase substantially to feed the growing requirement for food protein from pulses but faces several obstacles in key growing nations.
On the other hand, animal protein derived from meat and poultry may be cheaper to produce and consume although production increase has not occurred uniformly worldwide and many poor communities continue to lag behind in animal protein consumption, according to FAO.
“Average consumption of livestock protein in Africa is less than a quarter of that in the Americas, Europe and Oceania, and represents just 17 percent of the recommended consumption level for all proteins,” says FAO's report. “By contrast, the consumption of livestock protein in the Americas, Europe and Oceania in 2005 was between 78 and 98 percent of the total protein requirement, suggesting that livestock products are being over-consumed.”
But in the developing world, livestock and livestock products can make a crucial contribution to household economic and food security — as well as nutrition, FAO report said.
Even small amounts of animal source foods can improve the nutritional status of low-income households. Meat, milk and eggs provide proteins with a wide range of amino acids as well as micro-nutrients such as iron, zinc, vitamin A, vitamin B12 and calcium, in which many malnourished people are deficient.

Corn, Soybean supplies hold the key

For any meaningful growth of poultry, meat industry the soybean, Corn supplies would have to substantially rise worldwide. In several producing nations, corn and soybean face challenges of lower productivity and adverse climatic conditions such as drought. Drought can Lead to losses for corn growers of up to $13 billion annually,” said John Bedbrook, vice president, DuPont Agricultural Biotechnology. “ Recently DuPont and Rosetta Green Ltd had entrered into a strategic agreement to identify drought tolerance genes in corn and soybeans.
“Water is one of the most significant inputs for farmers. On average, 85 percent of corn acres experience some level of yield reduction due to drought stress during the growing season. Improved drought tolerance in corn and soybeans will enable growers across the world to increase productivity while responsibly managing water resources.” DuPont said.
Soybean and corn has now a competing demand from the biofuels industry that seeks more Ethanol from food grains. The trend has already been set in US and Brazil, the global powerhouses of of the biofuels world. The competing demand from biofuels industry is good news for farmers but not so for the meat and poultry industry.
The coming years will be interesting for the food grains and oilseeds industry as new market dynamics take shape due to changing food habits and rising Crude Oil prices making a radical shift in demand for cleaner fuel.

Source/Author: By Sreekumar Raghavan; the author is an award winning senior business journalist and presently, Chief Commodity Strategist at Commodity Online. Sreekumar Raghavan has written extensively on pulses, oilseeds, spices and food grains issues in India with a global perspective. His recent articles on agriculture has dealt with the need for a new model for India's second agricultural revolution and the emerging food protein crunch worldwide.)