“If you can tell me something else where the fundamentals are so attractive…I’d be happy to put my money there,” said Jim Rogers, the famed investor and self-made billionaire in a recent interview. “But I don’t know of any other place.” What’s he talking about? Agricultural commodities like soybeans, wheat and corn.
We begin our analysis with some simple “big picture” truths. The world’s population has more than doubled since 1950 – from about 2.5 billion to 6.7 billion. By 2050, there will be more than 9 billion people on the planet. Almost all of this growth will occur in the emerging markets like China and India. And their populations will all be doing one thing, for sure – eating.
Now, hang on. I know that is a banal insight by itself, but this story has more layers than a tiramisu. After population growth, he second layer is the mix of food eaten, which is important. These undeveloped economies are becoming wealthier. Predictably, as people everywhere have done and continue to do when they have a little more money in their pockets, they change their diets. They spend more on food. The average Chinese person spends 40 cents of every additional dollar earned on food. In India, it’s about 70 cents of every additional dollar. What do they buy? (more)
[unable to retrieve full-text content]Reuters - China's leader-in-waiting, Xi Jinping, gathered with U.S. agricultural officials in America's grainbelt on Thursday and stressed their shared interests in fostering increased food security and trade in farm goods. Natural Food
ReplyDelete