The U.S. Grains Council just held it’s International Marketing Conference and the keynote speaker was the Hon. Carole L. Brookins, Managing Director of Public Capital Advisors, LLC.
Her topic was “Growing Grain Markets in a (Sustainable) Brave New World.”
“We are moving into a new era of focus on global public goods, including money, trade, climate and environment. With that come global threats: cyber terrorism, fragmented political and economic power, radical groups seeking to control weapons of mass destruction and piracy on the high seas,” she said.
Brookins identified four trends shaping our world today. First – a re-balancing of global wealth and power. “There are shifts in global economic leadership, which creates a wider competition to maintain and grow market share,” said Brookins. Second – a revolution in energy supply and markets. According to Brookins, this is fueled by climate change, resource depletion, energy security and technological innovation. Third – a rebellion against the modern food system. “Activist groups attack the safety and value of the modern food production system,” she said. Fourth – a resurgence of investment in commodities and agriculture. According to Brookins, this will be stimulated through investments, control of the supply chain and economic power.
“Experience shows that sustainable global food security will depend on intensive, large scale agriculture and expanding global trade,” Brookins said. “Both your risks and reward will be multiplied. Your complexity of choices and competition will be magnified. The brand of the Council is highly respected around the world. Renew your mission in 2010 and lead out in a growing, dynamic world of 9 billion lives over the next 50 years. I look forward to watching.”
Participating in the conference is NCGA CEO, Rick Tolman, seen here addressing one of the meetings. NCGA is one of the founding members of the U.S. Grains Council.
Rick, who worked for USGC for many years, says that NCGA considers the Grains Council their international trade partner. The two organizations have a very strong working relationship. He says one of the things he’s really happy to hear discussed here at this meeting is how well exports of DDGS have been due to the efforts of the Grains Council. That’s good news for corn growers for whom the production of ethanol is so important right now. He says that the Grains Council is looking at other value added products they can promote for export too.
I spoke with Rick in between meetings and you can listen to the interview here:
A consistent theme was the growth potential in these markets. That’s why the USGC has people on the ground working to develop new business opportunities for American farmers. After our team’s final dinner I spoke with them as a group to get their final thoughts on what they’d like farmers back home to know about their experience. We just went around the table starting with the corn grower members. Here are some of their final thoughts:
The main thing is the relationship the USGC staff has with people in all these countries. They appreciate what the USGC does.
I got to see what the USGC does on a personal level. These ddgs programs are working well. I hope they’ll buy more.
I sure learned a lot about the legwork that goes on on the ground here for these guys. There’s still some work to be done.
We spent our time well and did something that will benefit everyone back home. The USGC work has been an important part of keeping our exports going.
I think the potential for increased sales is there. The network is in place and working well.
Demand looks strong and will continue for a long time to come.
Shannon Schaffer, the USGC staff representative on our trip added these thoughts:
These guys worked really hard on this trip. Lots of time spent on the road and with the customers we service. They served as ambassadors for the USGC and corn growers specifically.
You can listen to Chuck’s final interview with the Corn Mission Team below:
Read all about the trip and see all the photos on Agwired and/or USGC’s The Grain Board.
Apparently, last week’s International Energy Agency (IEA) numbers regarding future oil supplies were fudged to protect the innocent or at least our frail economic recovery. According to a whistleblower who whispered in the ear of The Guardian, the world is much closer to running out of oil that we think.
So, what is to be gained or lost by such skullduggery? Stockbrokers, bankers and oil investors jumping out of windows…sure, but what is the downside? (Insert sarcasm here).
The comments in the UK’s respected Guardian stated that the IEA has inflated its 2009 report of oil reserves for fear that the truth would shock world markets into a reactionary panic. IEA is alleged to have put its role as an industry watchdog in the kennel for the time being to fend off a potential buying panic…even at the risk of being exposed for overplaying supplies and chances for finding increased reserves.
On face value this might seem to be based on at least a modicum of twisted logic, but what are the ramifications for world governments who govern, plan and even invest based on IEA’s data? Consider that they also develop their own energy policies based on such essential information.
According to the Guardian’s high-level IEA source, estimates of global oil production growing from its current level of 83 million barrels per day to 105 million barrels per day are as bogus as the Tooth Fairy. The source said many IEA officials believe even 90 million barrels per day is unreachable, but the agency will not lower its forecast because it fears panic could spread through financial markets.
If we have indeed entered the “Peak Oil Zone” (that strange and unfamiliar place where we actually feel the pressure to get real about “energy policy” not oil policy) then it is time to fess up like an alcoholic at an AA meeting. “Hi my name is Joe Consumer and I have a petroleum problem.” (more…)
Just in time for Thanksgiving, the country of Turkey dropped a big, fat egg on grain imports.
The U.S. Grains Council reports that last week, Turkey placed an unexpected ban on imports of biotech crops.
Turkey, the 27th largest export market for all U.S. goods, issued a new regulation on Oct. 26, 2009, placing additional requirements on all food and feed products containing genetically enhanced components. This new regulation essentially came without warning, according to U.S. Grains Council Regional Director in the Middle East and Subcontinent Joe O’Brien. “This ban came at us pretty much out of the blue,” he said. “This regulation impacts everything from a bag of potato chips to grains and co-products.”
The Office of the United States Trade Representative (USTR) reported on its Web site that this signifies approval of the fourth draft of a National Biosafety Law and is similar in nature to the draft reviewed last year. O’Brien said the potential impact is substantial to U.S. coarse grains and producers. For example, Turkey is the largest buyer of U.S. corn gluten feed (GCF) and the third-largest buyer of U.S. distiller’s dried grains with solubles (DDGS). Turkey imported 435,378 metric tons of CGF in 2008 and 202,422 tons in the first six months of 2009. Turkey imported 465,212 tons of U.S. DDGS in 2008 and 199,173 tons from January through August of this year. USTR reports the U.S. goods trade surplus with Turkey was $5.8 billion in 2008, an increase of $3.8 billion from 2007. USTR also notes the total value of U.S. “transgenic” crop exports to Turkey exceeded $1 billion in 2007, which are endangered depending on how this new regulation is implemented. O’Brien said one issue currently “up in the air” is the fate of the vessels currently on the water loaded with U.S. goods.
There is a good chance the regulation will be reviewed and possible reversed, but immediately after it was issued last week there was a big holiday in the country, which effectively shut down all government operations (it was Turkey Independence Day). USGC is working with USTR to get the decision changed.
As the battle for biotech crops continues in many countries, including Africa, a recent study finds that improved corn varieties have made a significant impact on reducing poverty.
According to an article published in Agricultural Economics, a multi-country study documents the significant role international maize research plays in reducing poverty. It finds that since the mid-1990s, more than one million people per year have escaped poverty through the adoption of new maize varieties.
Key economic benefits from maize research are primarily the result of the productivity gains farmers experience after adopting modern varieties. While notably scant prior to the 1980s, the percentage of MVs found in a maize area grew from 5 % in the 1970s to 60% in 2005. The study results suggest that without research to maintain or increase maize yields, poverty in the region would be substantially worse.
Googling around for more information on African maize production, I found this story on the Alliance for a Green Revolution in African (AGRA) website that tells the story of Able Traore, a West African farmer who started using modern seed varieties on his small farm two years ago that have increased his yields by 50 percent. “If I had known what I know now, I would not have left the country for any other place. I wish that all my kids become farmers. Farming is the most pleasant job you can do in Mali,” Traore says. How true is that?
Of course, it’s not just better, higher yielding varieties that will continue to help Africans feed themselves. It is also access to more modern farming methods, fertilizer and inputs. As the AGRA website states: “We know that through dramatic improvements to agriculture, prosperity can replace poverty. In most modern economies, no lasting success has been achieved without first building a strong agricultural foundation.” True again.
No doubt that much of the credit for the improvement over the past 30 years in Africa must be given to the late Dr. Norman Borlaug. In 1986, Borlaug began working with the Sasakawa Africa Association, which aims to defeat malnutrition and poverty in Africa. At a memorial for Borlaug earlier this month, Yohei Sasakawa promised to carry on Borlaug’s dream that African children would someday not have to go to bed hungry. “You cultivated a dream that would empower the farmers, you planted the seeds of hope, you watered them with enthusiasm, you gave them sunshine, you inspired with your passion, you harvested confidence in the hearts of African farmers,” he said. Amen.
At the World Food Prize Forum in Des Moines on Thursday, Microsoft founder and philanthropist Bill Gates praised the work of Norman Borlaug and called for a new “Green Revolution” to help feed the poorest of the world’s poor. Gates also announced grants totaling about $120 million to help small farmers in developing countries such as Africa.
“In the middle of the 20th century, experts predicted famine and starvation, but they turned out to be wrong – because they did not predict Norman Borlaug. He not only showed humanity how to get more food from the earth – he proved that farming has the power to lift up the lives of the poor,” Gates said.
The billionaire noted that Borlaug’s Green Revolution “helped avert famine, save hundreds of millions of lives, and lift whole countries out of poverty” but “it didn’t go far enough. It didn’t go to Africa.”
He blames that on ideological differences between technology and environmentalism that forces a “false choice” between productivity and sustainability. “It blocks important advances. It breeds hostility among people who need to work together. And it makes it hard to launch a comprehensive program to help poor farmers. The fact is, we need both productivity and sustainability – and there is no reason we can’t have both.”
“We have to develop crops, including new inputs to go with them that can grow in a drought,” Gates said. “We have to have crops that can survive a flood, that can resist pests and new diseases. We need higher yields on the same land, despite more difficult weather. And we will never get there without a continuous and urgent, science-based search to increase productivity, especially focused on the needs of small farms in the developing world.”
I’m no big fan of Bill Gates, but I was very pleased to hear him standing up to radical environmentalists who want us to move backward instead of forward and supporting the use of biotech crops to help the poor in developing countries grow enough food to feed themselves.
You can watch Gates’ address on YouTube in three different segments (due to the 10 minute limit on videos for YouTube). Here is the first installment.
Taiwan is expected to purchase $3.5 billion in soybeans, corn and wheat from the United States over the next two years and last week Taiwanese delegations traveled around the Midwest to see their future purchases in progress and formalize agreements on the state levels. The groups visited a number of states, including Indiana, Illinois, Iowa, and Missouri and met with corn and soybean grower organizations and state officials.
In Missouri, they met with Governor Jay Nixon and representatives of the agricultural industry and signed a Letter of Intent to purchase between 303 and 413 million bushels of American corn and up to 750,000 metric tons of distillers dried grains, with a total estimated value of up to $2.37 billion.
Iowa Corn Growers Association president Don Elsbernd met with the Taiwan delegation in his state and signed the agreement with them. “As our 4th largest customer, we see this agreement as critical to our corn industry in Iowa and we think it shows their satisfaction with the product we are providing,” he said.
National Corn Growers Association board member Guy Davenport of North Carolina has been taking part in the U.S. Grains Council’s Annual China Corn Tour this month which has already visited Northern China Plain regions of Henan, Anhui, Hebei and Shandong Provinces and is now touring the drought stricken Northeast region of China.
During a conference call from China this morning, Guy talked about what they have been seeing. “China corn farming was certainly not what I envisioned it to be,” Guy said. “They have soils that are just as good as ours, very large fields that are very comparable to our Midwest farms.” Guy says they found most farmers had just about five acres, but they were small holdings all close together, giving the impression of vast acreage for miles. They also found out that harvest is done by hand and takes a typical farmer about ten days.
As a representative for all corn growers, Guy will be reporting back to the NCGA board what he has learned in China. “I think this gives us a better perspective about how much corn can be grown in that part of the world, how efficient they are in their corn production and to what extent they use irrigation. It was truly an eye-opening experience to me.’
Cary Sifferath, USGC Senior Director in China, talked about the drought conditions in the country and high corn prices. “Those high prices have led to some opportunities for US feed grains products, specifically distillers dried grains (DDGS) products from the US ethanol industry,” Cary said. “We had roughly 8,000 metric tons of DDGS that was exported from the US into China and right now for 2009 we can easily predict 250,000 to 300,000 tons of distillers dried grains being imported by China’s feed and livestock industry, especially in the southern and coastal areas of China where DDGS has become a very competitive feed ingredient.”
While the U.S. struggles with how to reduce our carbon footprint and cut greenhouse gas emissions our British cousins have applied some novel thinking to the quandry of climate change by formulating a theory that population control can handle this environmental concern without handicapping family farms or non-Ag businesses.
The Brits have been obsessed with overpopulation since at least Thomas Malthus. Now comes a new report (PDF) commissioned by the Optimum Population Trust and conducted by the London School of Economics, which says expanded access to family planning and contraceptives is five times cheaper than low-carbon technology in reducing greenhouse gases.
A new blog post by B.C. Upham notes the study says shows $7 spent on family planning would reduce carbon emissions by one ton, by reducing the number of people emitting carbon. By contrast, low carbon technologies cost an estimated $32 per ton reduced.
Some may greet the concept as socially unacceptable or just inane but at least it is nice to see someone offer a pro-active option that doesn’t include penalizing businesses of all kinds, and put the lion’s share of dealing with climate change on the U.S.
The U.S. Grains Council just held it’s International Marketing Conference and the keynote speaker was the Hon. Carole L. Brookins, Managing Director of Public Capital Advisors, LLC.
The U.S. Grains Council is holding its 
A consistent theme was the growth potential in these markets. That’s why the USGC has people on the ground working to develop new business opportunities for American farmers. After our team’s final dinner I spoke with them as a group to get their final thoughts on what they’d like farmers back home to know about their experience. We just went around the table starting with the corn grower members. Here are some of their final thoughts:
Apparently, last week’s International Energy Agency (IEA) numbers regarding future oil supplies were fudged to protect the innocent or at least our frail economic recovery. According to a whistleblower who whispered in the ear of The Guardian, the world is much closer to running out of oil that we think.
The 
Googling around for more information on African maize production, I found 
“In the middle of the 20th century, experts predicted famine and starvation, but they turned out to be wrong – because they did not predict Norman Borlaug. He not only showed humanity how to get more food from the earth – he proved that farming has the power to lift up the lives of the poor,” Gates said.
In Missouri, they met with Governor Jay Nixon and representatives of the agricultural industry and signed a Letter of Intent to purchase between 303 and 413 million bushels of American corn and up to 750,000 metric tons of distillers dried grains, with a total estimated value of up to $2.37 billion. 
As a representative for all corn growers, Guy will be reporting back to the NCGA board what he has learned in China. “I think this gives us a better perspective about how much corn can be grown in that part of the world, how efficient they are in their corn production and to what extent they use irrigation. It was truly an eye-opening experience to me.’