Food Production Becoming Better Investment than Oil

Demand for food is growing faster than demand for oil. As human industries grow more sophisticated, they learn to do more with less oil. But as human societies grow more sophisticated and more urbanised, they demand more food -- and of a better quality and a wider variety.

China's demand for food is expected to grow particularly quickly, as the population urbanises, and China experiences more and more difficulty with decreasing quality of water and soil.

"In 10 years," Gua said, "China will be importing 50 mmt of corn. In fact, less than 10 years." China currently imports no corn.

This rapid increase in buying the world's grain despite the cost is due, Gua said, to China's economic growth in the past 30 years, more people moving from rural areas to urban, and government policy to assure there is plenty of food to feed its 1.3 billion people.

As urban areas expand, more tillable acres are lost to crop production.

...As the middle class gets more prosperous, more meat is sought in Chinese diets, he said. _China's Growing Food Demand

With higher meat consumption, more animal feed is required. Most of that increased supply will come from overseas, particularly Brazil and the US.

Global Soils

The US continues to be a good bet for food production, due to its excellent farmland, advanced farming practises, good climate, good transportation infrastructure, and generally reasonable government policies.

A lot of factors need to be addressed when assessing a purchase of farmland around the world. We see U.S. farmland as the best opportunity for investors as it has some of the best soil in the world, the perfect climate for fertile crops, the adequate infrastructure for transporting grain, and a government that supports its farmers and property rights. _US Farmland

As Chinese farmland is lost to urban growth and development (as well as to toxic industrial products dumped into the soil), and as more farmers move into cities for work, China will have to cultivate more foreign food suppliers. Besides Brazil, China is also looking toward Africa as a future producer of food for China.

Currently, Africa accounts for just 3% of global agricultural trade, with South Africa and Côte d'Ivoire together accounting for a third of the entire continent’s exports. But if the world wants to feed itself then it needs Africa to emerge as an agricultural powerhouse. _ZeroHedge

But there are serious problems with developing African infrastructure of any kind, including food production.

local farmers are skeptical when foreigners come to their country. Farmers react quite emotional and do not want to sell land that they got from their ancestors. It’s hard to understand how important land is to most of the population. Many fear that if they sell out their land the country will be driven back to the colonial days of the past. _Farming in Africa

In Brazil, most of the farmland is owned by just a relative few large landowners -- 2/3 of the land is owned by 3% of landowners. It is much easier for China to make deals with these "land oligarchs" of Brazil, than with the many small farmers and holders of Africa.

China is at a huge disadvantage as it accounts for 20% of the world’s population, but only 7% of arable land. Compare that with Brazil which has the reverse of those ratios.

...we would expect the big gainers of a meaningful rise in food prices in real terms to be Brazil, the US and Canada, while Japan, South Korea and the UK would face challenges... China’s surplus has turned to deficit. What will happen if the Chinese middle class swells as it is expected to? And that’s the rub; what we have been used to in terms of food’s importance is set to change. How food moves around the world is likely to change, and the flow of currency around the world will also likely be impacted. _ZeroHedge

ZeroHedge

Modern high production agricultural requires plenty of oil, fertiliser, sophisticated farmers, high quality transportation infrastructure, and ready industrial support. While Africa may possess 60% of the world's uncultivated land, its land is not all of the best quality, and Africa's support infrastructure leaves a great deal to be desired. Africa cannot even feed herself on her own.

Europe has good infrastructure and sophisticated farmers, but not as much high quality farm area as it once had. Russia and the Ukraine suffer from inferior infrastructure and a more sluggish industrial support -- as does much of Asia and South America.

Canada and the US -- as well as parts of Latin America -- stand to benefit the most from a global boom in demand for agricultural products. But Europe is still well positioned as a premier processor of food, beverages, and food products.

The best US farmland is likely to be bid up in price, over time.

Fortunately, there are plenty of ways to start with an inferior soil, and develop it over time so that it acquires superior fertility.

African Biofuels: What to Expect

The 3rd Annual African Biofuels conference is to be held on 10-13 March 2008 in Midrand, South Africa.The African Biofuels conference aims to:

• Provide in-depth insight into the growing African biofuels market

• Offer critical global information for the enhancement of biofuels-related businesses

• Cover every major aspect of the industry from policy and pricing to feedstock crops and CDM

• Give delegates exposure to more than 400 peers and over 50 technology and service providers

• Host a dedicated SMME Workshop for the development of small scale producers___Source

Africa has vast areas of land with great biofuels potential.

...the high rainfall belt between Angola, Zambia and Mozambique alone had the potential to rival the United States as a producer of...bioethanol.

"It's almost as big as the size of the midwest of America. It has the same of type of potential and could actually outperform America___Source

It is important for Africans not to repeat the mistakes of the United States maize ethanol producers.

"Two potential crops have been identified for the fuel ethanol initiative in Nigeria: sugarcane and cassava. Nigeria is currently reputed to be the leading producer of cassava in the world of about 30 million tons annually," states Onochie Anyaoku, group general manager of NNPC's Renewables Division. "The potential must be seen against the background that the average yield in Nigeria is put at about 15 tons/hectare as compared to 25-30 tons/hectare obtainable in other countries.___Source

Cassava and sugarcane both grow well in many parts of Africa. Cane gives much higher yields of alcohol than maize, and cassava fits more growing regions of Africa than maize.

Which crop grown in Africa produces twice as much as maize and three times as much as millet or sorghum? And which crop has seen Africa emerge as overall leader, accounting for more than half of the world output, with Nigeria as the biggest producer? Which same crop has seen production levels triple on the continent over the past 50 years? And now covers one-third of the dietary needs of its population? The answer is cassava.___Source

For biodiesel, we can expect Chinese and other giga-investors to attempt large-scale deforestation in Africa for Palm Oil plantations--just as they are doing in Indonesia, Malaysia, and the Philippines. But Jatropha is the better oil seed crop for Africa, since it grows in the same fields as other crops--while improving the topsoil from its shed leaves, a rich fertiliser.

Interest is particularly growing in the perennial oil nut bearing jatropha tree, which is viewed as the most feasible plant for dry-land cultivation for the extraction of bio-oil...The plant was often used for snakebites, as an insect repellent and for constipation.

The jatropha tree originates from South America, but was brought to the southern African region by Portuguese explorers....The seeds of the plant grow on low fertility soils in low and high rainfall areas; it has a small gestation period, and can be harvested in non-rainy seasons.

The size of the plant is also convenient for collection of seeds. It produces seeds with a high oil-content (30 to 40 percent) after two to five years, depending on soil fertility and rainfall. According to Mwewa, the plant can yield one liter of oil from three kilogrammes of the nuts, and harvesting can be done over a 50-year period.

The oil from the jatropha plant can be transformed into bio-diesel fuel - which is produced from the reaction of vegetable oil with alcohol in the presence of a catalyst to yield mono-alkyl esters and glycerine, which is then removed - through an etherification process...What makes it more popular amongst protagonists of bio-fuels is because of its toxicity, it is not for human consumption, and therefore not in competition with food crops. Threats to food security are recognised as the primary drawback of large-scale bio-fuels development.___Source

If the Africans can avoid the destruction of large swathes of of rainforest, and stay out of the maize ethanol trap, do not depend on food crops for fuel, and most importantly--do not betray the small farmers in favour of the giga-conglomerates, she may grow into a significant player in the world sustainable energy game, without paying an onerous environmental and sociological price.

Tropical Palm Oil vsJatropha Oil: Why Not Both?

Palm oil produces higher yields than Jatropha oil, by about 5 to 3. But monoculture palm oil plantations destroy large areas of tropical forest, along with the entire ecostructure that depends upon those forests. The Chinese investors in palm oil plantations do not care about the environment, but there is evidence that Japanese investors in palm oil are thinking about sustainability.

The plant will utilize jatropha curcas and palm oil for biodiesel and power production. The crops are to be established on 100,000 hectares of plantations. Besides biodiesel, a biogas plant will be build to utilize waste streams from the crop processing operations.___Biopact

By combining the cultivation of jatropha along with palm oil, the Japanese venture protects and builds the topsoil, and increases yields--using less cultivated land. By also using biomass waste streams from crop processing, the Japanese project achieves still greater energy yield from the same land area.Biofuels can be developed responsibly, or they can be developed without concern for long-term consequences. The Chinese seem to be acting with a reckless disregard for the environment, whereas the Japanese are acting in a more civilised and responsible way. Wanton destruction of tropical habitat is not the proper way to develop biofuels.

Palm oil has so much better oil yields per hectare than soy, corn, rapeseed, etc. that (like corn ethanol) biodiesel from North American oil seed crops could not survive without government subsidies and tariffs. North Americans can do better by taking the algae approach, and by using biomass energies.

Economic indicators suggest that palm oil biodiesel is beginning to be taken seriously on world markets. Let's hope that the Japanese approach takes precedence over the Chinese approach.

Optimistic About Topsoil

Optimists tend to be more productive than pessimists. While the media is full of pessimistic voices about "global warming disaster", "peak oil catastrophe", "water shortages", "topsoil depletion", etc., the media does not bother to look for solutions to all of these "problems." Finding solutions is for optimists, who are not afraid to get their hands dirty.

Take dirt, for example. Soil--topsoil to be more specific. While whining "environmentalists" and journalists waste forests of paper telling everyone how hopeless the situation is, individuals more in contact with the real world set about to find ways to build new topsoil, and make it more fertile. One approach to soil fortification is "biochar:"

Biochar or agrichar is a fine-grained charcoal substance made from biomass that has been heated in the absence of air. When used as a soil amendment in combination with sustainable production of the biomass feedstock, biochar effectively removes net carbon dioxide from the atmosphere while providing energy....Biochar can remain in the soil for several hundreds to thousands of years, creating virtually permanent soil sinks. Biochar and bioenergy co-production from urban, agricultural and forestry biomass can help combat global climate change by displacing fossil fuel use, by sequestering carbon in stable soil carbon pools, and by dramatically reducing emissions of other greenhouse gases from soils, such as N2O

...Biochar in soils has been shown to:

* Improve soil health
* Increase crop yields and productivity (by up to 800% when combined with mineral fertilizer in highly weathered acidic tropical soils; by 200 and 300% in advanced agricultural systems that are already at the limit of intensification)
* Reduce soil acidity; acid soils make up about half of the world's potential arable land
* Reduce N2O emissions from soils
* Improve water quality
* Reduce nutrient and chemical leaching and run-off, and
* Reduce the need for chemical and fertilizer inputs___Biopact

Other methods of building topsoil include composting in raised beds, using the essential ingredients:

There are six essential ingredients for soil formation.

1. Minerals
2. Air
3. Water
4. Living things IN the soil (plants and animals) and their by-products
5. Living things ON the soil (plants and animals) and their by-products
6. Intermittent and patchy disturbance regimes

* For soil to form, it needs to be living (4)
* To be living, soil needs to be covered (5)
* To be covered with healthy plants and decomposing plant litter, soil needs to be managed with appropriate disturbance regimes (6)

There is little information available as to how to increase the levels of air, water and organic materials in soil. For this reason, components 5 and 6 of the soil building checklist tend to be overlooked. That may explain why many people believe that new topsoil cannot be formed.

One has to wonder, how did all the topsoil get here in the first place? We know how quickly we lose it when we ignore the fundamental importance of components 5 and 6. To turn things around, we need to encourage soil building processes every day in our land management.___Source

Here is an online book detailing the use of the earthworm for topsoil formation. And this US Patent describes the use of water-based drilling mud for building topsoils. Most creative.

Tropical soils are a bit different, but an intelligent selection of cover crops can make all the difference in building tropical topsoils.

The topic of topsoils is more down to earth than most topics covered at Al Fin. Yet a more intelligent approach to topsoils would go a long way toward improving crop yields and food supplies in much of the world. Certainly a more sustainable approach to topsoils in the industrial world would result in less expenditures on chemical fertilizers and less damaging agricultural runoffs into the water table.

China: Scratching its Way to the Top by Industrial Espionage, Counterfeiting, Reverse Engineering, Spying, Cheating, Bluffing . . . .

China poses as a rising star in the world of commerce, industry, technology and science. But China's recent stock market scare reveals how closely China's success hangs upon financial and technological achievements in the west. If China were unable to steal, counterfeit, pirate, and reverse-engineer superior achievements of technology and science in the west, how many decades behind the west would China be?

The government believes that, in the next few years, China will surpass South Korea in technical abilities, and Germany in GDP. While China is still a minor player in the world of military high tech, the government is putting lots of money and effort into changing this. Expensive, and long term, efforts are being made to produce high tech items like jet engines, missiles and military electronics. At the current rate of progress, Chinese military technology will match that of the United States in a decade or so.

Strategy Page

In a mad rush to surpass the west, China is poisoning its air and water, destroying and depleting its topsoil, stealing from its trading partners, sending poisoned toys,food,and other merchandise overseas, misrepresenting the size and health of its banks and state enterprises, and becoming the world's leading destructive state computer hacker and possible currency counterfeiter (via N. Korea).

...there is a long record in China of sending government-directed missions overseas to buy or shamelessly steal the best civil and military technology available, reverse engineer it, and build an industrial complex that supports the growth of China as a commercial and military power....The allegations against Chen Jin, of Jiaotong University in Shanghai, are an example of the entrepreneurial approach people take toward industrial espionage and intellectual property theft in China. Chen returned to China after earning a Ph.D. at the University of Texas at Austin. In 2003, China treated Chen like a national hero for inventing China's first signal processing microchip. Last week, Jiaotong University dismissed him, and Chen stands accused of hiring flocks of migrant workers with good manual dexterity and great eyesight to scratch the name "Motorola" off chips and etch in the name of Chen's company, "Hanxin."

Source

Is the government involved in Chinese counterfeiting? What do you think?

The second point is equally important. The piracy and counterfeiting that exists in China is largely the result of a tacit government policy to allow such practices to flourish. China has a relatively comprehensive set of antipiracy statutes on its books. However, little or no enforcement exists, and what fines and punishments do exist serve as only weak deterrents.

The reason for China's tacit sanctioning of widespread counterfeiting and piracy is that the Chinese government is well aware of two things. Counterfeit and pirated goods sold domestically help keep inflation low, and selling these goods internationally creates jobs and export revenues.___Source

Some of the counterfeit exports being sent overseas from China present a significant hazard to the end users.

Counterfeit high-tech items are a growing business, and a growing danger. In addition to computer gear, auto and aircraft components are also being faked. Some aircraft and auto accidents have been traced to the fakes, which makes it a public safety issue. But with the Department of Defense installing counterfeit computer components, it becomes a national security issue. There's also the fear that the Chinese, or some other hostile nation, might get their hands on real computer components, and replace some of the chips with modified ones that will make government networks easier to hack. Yes, it just gets worse.

Strategy Page

China is destabilizing the world's security.

China’s goal is to dominate in all sectors – from the lowest, most labor-intensive sectors to the highest and most advanced technological sectors – as quickly as possible. To accomplish these goals, China must have access to advanced technology. FDI gives China this access. Once the advanced technology is introduced into China, China gains access to the technology. Some of this access is lawful, but much of it is through unauthorized copying, theft, and counterfeiting, all of which allows China to obtain technology transfer without the payment of fees.___Source

China's recent moves into the third world, including Africa, should raise eybrows--particularly regarding the tendency of Chinese consumer exports to be poisoned.

The upcoming Beijing Olympics are a source of pride for the Chinese CCP, but amid all the other illegitimacies, is China hosting a counterfeit Olympics? There is significant international concern over the safety of food and water to be provided by the host country for Olympic athletes and guests. I wonder if the Chinese people themselves are wondering about the future safety of Chinese food and water? No, they're too busy worrying about the present.


China wants to be taken seriously by everyone, including the world's superpower. To accomplish this, China intends to gouge, steal, lie, cheat, copy, counterfeit, hack, intimidate, subvert, proliferate nukes, reverse engineer, spy, and bluster its way to the top.

In the process of its grand strategy, China's people and environment are being poisoned, while the world's environment is sullied. China's pro-proliferation policies and close friendships with state sponsors of terrorism such as Iran and Venezuela, suggests long term plans to destabilize the islands of prosperity within both the developed and developing worlds.

Nothing about the method of China's rise suggests the intent to become a responsible world co-citizen. Nothing indicates a will to create a better world, with prosperity and security for all. Instead we see a Chinese CCP hell-bent to achieve superiority and hegemony in every area--while destroying its own ecology and the ecologies of East Asia. There is nothing admirable or encouraging about China's gutter tactics, its quasi-criminal methods of achievement.

We will see how long the civilised world can ignore China's criminal underworld nature, and what the consequences will be for having ingnored it from the days of Bush I, Bill Clinton, to the present.

Topsoil: It's the Organisms, Stupid!

There is nothing magical about topsoil. For thousands of years, humans have been able to detect when soil was healthy and capable of growing good crops. Although pre-scientific humans knew nothing about the details of decomposition, they could tell a good crop from a bad crop--and quickly learned the external characteristics of good soil.

Now we are being told that the earth is losing its topsoil, and that such a loss can never be recovered. Regular readers of this blog may recognise such claims as "appeals to the pseudo-apocalypse." Which is precisely what they are.

It is certainly true that mining and other industrial processes destroy topsoil. And while conventional methods of remediating soil from mining and from other industry may be effective, they can also be extremely expensive.

Scientists in Russia have developed complex mixtures of micro-organisms that can be placed in situ, to remediate soil from petro-chemical contamination. Canadian scientists have gone farther, creating symbiotic combinations of plants and microbes, to clean contaminants from soil in situ.

Researchers are always looking for new bacteria in the strangest places. Or perhaps, not so strange, if you are looking for assistance for petroleum cleanup.

Here is a short description of the micro-world of soil:

• Bacteria -- Bacteria are the tiniest and most diverse of all soil organisms. A single teaspoon of topsoil typically contains more than 100 million bacteria that belong to over 1,000 different species. Bacteria help to decompose residue in the soil and increase nutrient availability for plants by dissolving phosphorus and fixing atmospheric nitrogen. Some bacteria that live on plant surfaces can also prevent plant diseases, either by antagonizing pathogens or stimulating the plant’s own immune systems.

• Fungi -- Fungi are important in the break down of plant residue, and they can transport nutrients through the soil profile. Because they are tougher than bacteria, they tend to release nutrients more slowly so that plants can have access to them throughout the growing season. Some fungi, called mycorrhizae, develop beneficial relationships with plants that allow for nutrient and water absorption by plant roots. Fungal cells also help to stabilize soil structure by secreting a sticky gel that glues mineral and organic particles together into aggregates. These aggregates allow for natural breaks to occur in soil, allowing for greater aeration and water infiltration.

• Protozoa -- Protozoa are single-celled animals that act as secondary consumers of organic matter. They feed on bacteria, fungi, other protozoa, and organic molecules. Protozoa are believed to be responsible for mineralizing a small fraction of the nitrogen in soils.

• Nematodes -- Nematodes are simple worms that are less than one-tenth of an inch long. They help breakdown organic residues and feed on bacteria, fungi and protozoa. They also convert some nitrogen into usable forms for plants.

• Free-living mites -- Soil mites are arthropods that graze on decomposing organic matter, fungi, algae and nematodes. Mite populations are slow to develop, so their appearance indicates a highly stable soil environment.

• Springtails -- Springtails are arthropods found in decaying material. They are one of several biological agents responsible for the creation of soil, and are considered to be the most abundant of all macroscopic animals living in the topsoil.

• Earthworms -- Earthworms round out the list as important keepers and restorers of soil fertility. While less numerous than nematodes, they account for up to 10 times the biomass of the other secondary consumers. Earthworms feed on bacteria-laden plant residues and organic matter mixed with mineral particles. The resulting material is given off as worm casts, which are generally higher in available nitrogen, calcium, magnesium and phosphorus than the soil itself. Earthworms also constantly bring soil up to the surface, providing anywhere from one to 100 tons per acre of organic-laden soil for plant use each year.

“There are countless other organisms that contribute to the soil community. The variety of soil organisms is so high that even today we don’t have the tools to say what an average community really looks like from a small scale to a large scale,” said Gardener. “But it can be said that a healthy soil is often marked by multiple trophic levels of diverse microflora, microfauna and mesofauna.”

Source

Up until now, most of the microbe-hunting has been done by pharmacology researchers, looking for magic bullets against human infection, cancer, and other disease. More and more, such hunts are being done to find cures for environmental ills.

Plants can certainly be grown without soil, and in certain environments aeroponic crops will be the only source of fresh vegetables and fruits.

But the Earth itself has needs beyond the needs of humans. That is the concern. That is why humans have to learn to care for the health of the planet. Humans can learn to take care of themselves. They can also learn to care for the planet, even when their own welfare is not directly concerned.