Grain prices have been heading north this week, and I’m not surprised. And from where I’m sitting, it looks like they’re set to surge higher yet.
Weather is the short-term driver and, after a brief correction, wheat prices are up more than 6%, soybeans have rallied by 7.5% and corn prices have exploded 11% in less than two weeks.
But, in the long term, grain prices will continue to move higher for some very fundamental, demographic reasons, and chief among them is the fact that the world’s population is skyrocketing.
In 2011, the global population eclipsed 7 billion people. The rate of population growth has been nothing short of astonishing, with the number projected to hit 8 billion by 2025 – a mere 13 years from now.
The regions with the highest rate of population growth in the world are in Asia, Africa and the Middle East.
For some that’s a concern – but for the savvy sovereign investor, it’s an opportunity.
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