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The Megatrend

Key factors impacting the food supply situation and hence, the value of farmland:

Soaring global population

By year 2020, the global population is expected to reach the 8 billion mark, by 2050 the 9 billion mark [UN Medium Projections]. In other words, world population grows by 80 million people every year. Result: continuous and sharp rise of food consumption and demand.

Less calorie effective use of farmland due to change of eating habits

Significantly rising urbanization and the rising overall income in highly populated countries (particularly in South East Asia) with substantial parts of the populations emerging out of subsistence levels has been resulting in a drift towards a more protein based diet. However, it takes 21 times more farmland to produce the same amount of meat vis-a-vis rice.

China…..
For example, China already today consumes 25% of the global meat produce; meat consumption alone is expected to rise by 60% until 2020 [McKinsey  Global Institute, Nov 2011].

Loss of farmland and alternative uses

More than five million hectares of arable land (net) are being lost per year due to urbanization, climate change and lack of water for irrigation. Also, farmland is  increasingly used to produce commodities for biofuel production, which consumes 6% of global grain produce [FAO].