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Feeding the World: Time for a New Green Revolution

Speakers

Bill Cordingley, Managing Director and Head of Food and Agribusiness Research and Advisory-The

Americas, Rabobank International

Richard Kottmeyer, Global Agriculture and Food Production Leader, IBM Global Services

David Morgan, President, Syngenta Seeds, Inc.; Region Director - North America, Syngenta

Iris Yedidia, Group Leader, Agricultural Microbiology and Biotechnology, Agricultural Research

Organization, Israeli Ministry of Agriculture

Moderator

Carole Brookins, Managing Director, Public Capital Advisors, LLC

World GDP growth

The world economy is expected to recover from the global

financial crisis

-2

-1

0

1

2

3

4

5

6

7

8

1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016

Percent

Source: World Economic Outlook, April 2012.

Note: Projections are shaded.

World population World population is continuously increasing – 7 billion in Oct. 2011

Source: World Bank, 2012.

0

1

2

3

4

5

6

7

8

Billions Rural Urban

Arable land

Arable land as percent of total land is much less than it

twenty years ago

Source: World Bank,2012.

10.45

10.50

10.55

10.60

10.65

10.70

10.75

10.80

10.85

10.90

1990 1992 1994 1996 1998 2000 2002 2004 2006 2008

% of land area

Climate change in the world

Change in mean precipitation (mm per year) for 2040,

projected, relative to 1970-1999

Source: The Government Office for Science, London, 2012.

World food consumption

The consumption of major crops and livestock increases continuously

Source: USDA Economic Research Service, December 2011.

200

400

600

800

1,000

1,200

2002/03 2004/05 2006/07 2008/09 2010/11

Metric tons

Coarse grains

Wheat

Rice, milled

0

50

100

150

200

2002 2004 2006 2008 2010

Metric tons

Beef and pork

Broilers and turkeys

World commodity price (2005=100)

Food price and commodity price are increasing

Source: World Economic Outlook, April 2012.

0

50

100

150

200

250

1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012

Index

Food and beverage price index

Commodity price index

Agriculture productivity for the U.S.

Total factor productivity in the U.S. has been increasing since 1948

0.00

0.20

0.40

0.60

0.80

1.00

1.20

1948 1953 1958 1963 1968 1973 1978 1983 1988 1993 1998 2003 2008

Total factor productivity

Source: USDA Economic Research Service, January 2012.

Food expenditures

U.S. food expenditures as a share of disposable personal

income have been decreasing

Source: USDA Economic Research Service, January 2011.

0

5

10

15

20

25

30

1929 1939 1949 1959 1969 1979 1989 1999 2009

Percent

Global Hunger Index and its distribution

Global Hunger Index tends to decrease in the world and in regions

Source: International Food Policy Research Institute, 2012.

Agricultural export destinations

Top 10 U.S. agricultural export destinations by US$, 2011

Source: USDA Economic Research Service, 2012.

Mexico, 14.8%

Japan, 13.4%

Nigeria, 11.0%South Korea, 16.4%

Philippines, 10.3%

Taiwan, 4.5%

Indonesia, 1.7%

EU-27, 1.3%

Dominican Republic, 1.7%

Thailand, 5.4%

Food export commodities

Top 10 U.S. food export commodities by US$, 2011


0

2

4

6

8

10

12

14

16

18

20

US$ billions

Soybean exports

Top 10 U.S. soybean export destinations by volume, February,

2012

Source: USDA Economic Research Service, April 2012.

China, 64.3%Mexico, 5.3%

Japan, 5.6%

Indonesia, 3.4%

EU-27, 5.8%

Taiwan, 3.2%

Egypt, 3.1%

Turkey, 1.3%Tunisia, 0.7%

South Korea, 0.7%

World agriculture R&D input

Private R&D expenditures for food and agriculture, 2010

Crop protection chemicals

28.3%

Crop seed & biotech33.8%

Farm machinery21.7%

Fertilizer0.9%

Food animal health8.5%

Animal breeding & genetics

3.1%Animal nutrition

3.7%

Source: USDA Economic Research Report, December 2011.

U.S. agricultural research funding

U.S. agricultural research funding in public and private

sectors, 1970-2009

2.0

2.5

3.0

3.5

4.0

4.5

5.0

5.5

6.0

6.5

1970 1975 1980 1985 1990 1995 2000 2005

US$ billions

Private R&D funding

Public R&D funding


Technology - Genetically Engineered (GE)

crops Varieties of GE crops in the United States are increasing


0

20

40

60

80

100

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Number of varietiesCorn Soybeans

Carole Brookins

Managing Director, Public Capital Advisors, LLC

THINKING ABOUT “FEEDING THE WORLD”?

• “Between now and 2040…Water

problems will hinder the ability of

key countries to produce food and

generate energy, posing a risk to

global food markets and hobbling

economic growth..North Africa, the

Middle East and South Asia will

face major (water) challenges…”

- “Global Water Security”, US National

Intelligence Council, March 2012

U.S. real agricultural R&D spending

Source: Council on Agricultural Science and Technology.

0

2,000,000,000

4,000,000,000

6,000,000,000

8,000,000,000

10,000,000,000

12,000,000,000

US

Dlr

s(2

006-

Infl

atio

n A

dj)

Public Private Total

Disparate global maize yields

Source: FAO.

0

1

2

3

4

5

6

7

8

9

10

MT

/Ha

1.4 trillion 2012 global

R&D spending: How much in Food/Ag?

Source: Battelle-R&D Magazine.

USA-Private Industry $275; USG $125 bln

0

200

400

600

800

1000

1200

USA ROW

Bln

US

Do

lla

rs

FY2013 US federal government R&D budget $140.8 bln

US Government FY2013 R&D

Priority Agency Spending:

DOD, HHS, DOE : $115 Bln

Priority Tech/Innovation:

1. Clean Energy

2. Smart Infrastructure

3. Wireless Broadband

4. Cybersecurity

5. Aerospace

0 50 100 150 200

Livestock Production

Livestock Protection

Human Nutrition

New Products/Quality/Valu…

Food Safety

Crop Protection

FY2013 Agriculture R&D Budget –(BlnUS $2.3)

Bill Cordingley

Managing Director and Head of Food and Agribusiness Research and

Advisory-The Americas, Rabobank International

Population growth forecast, selected

regions, 2011-2021f

Source: UN Population Division, 2011.

+9%+10% +2%

+11%-2%+11%

+25%+3% +13%

+9%-2%

+12%

Food markets to grow by 109% in ten years

0

500

1,000

1,500

2,000

2,500

3,000

3,500

Siz

e o

f fo

od

ma

rke

t(U

SD

bil

lio

n)

Growth 2020

Food markets 2010

Source: Rabobank, based on KEO, Economist Intelligence Unit and FAO.

Economic growth effects consumption

Per capita income level Effect of economic growth

on food consumption

Number of people affected

(selected countries)

<USD 2 per day Eat more (increase calorie

intake)

2.6 billion

(Africa, India, Indonesia, China)

USD 2-10 per day Switch from grains to meat

and dairy

1.6 billion

(mostly in China)

>USD 10 per day Increase spending on

services/quality (convenience,

brands, fresh/cooled)

1.6 billion

(developed world)

Global yields sound the supply alarm bells!

World yield growth, 5-year moving average, 1966-2009

-1.00%

0.00%

1.00%

2.00%

3.00%

4.00%

5.00%

6.00%

1966

1969

1972

1975

1978

1981

1984

1987

1990

1993

1996

1999

2002

2005

2008

Wheat

-2.00%

-1.00%

0.00%

1.00%

2.00%

3.00%

4.00%

5.00%

6.00%

7.00%

1966

1969

1972

1975

1978

1981

1984

1987

1990

1993

1996

1999

2002

2005

2008

Corn

Source: Food and Agriculture Organization of the United Nations, 2011.

-1.00%

0.00%

1.00%

2.00%

3.00%

4.00%

5.00%

6.00%

1966

1969

1972

1975

1978

1981

1984

1987

1990

1993

1996

1999

2002

2005

2008

Soybeans

0.00%

0.50%

1.00%

1.50%

2.00%

2.50%

3.00%

3.50%

4.00%

4.50%

1966

1969

1972

1975

1978

1981

1984

1987

1990

1993

1996

1999

2002

2005

2008

Rice, paddy

Source: Food and Agriculture Organization of the United Nations, 2011.

Global yields sound the supply alarm bells!

World yield growth, 5-year moving average, 1966-2009

The supply/demand mismatch is the

biggest challenge

Arable land per capita, selected regions, 2009

Low land

availability, no

expansion

opportunities

Significant

expansion

opportunities

Potential land availability

Currently cultivated Potential supply of

additional land

Sub-Saharan Africa 210,149 201,540

Sudan 16,311 46,025

Dem. Rep. of Congo 14,739 22,498

South America and Caribbean 162,289 123,342

Brazil 62,293 45,472

Argentina 28,154 29,500

Eastern Europe and Central

Asia

251,811 52,387

Russian Federation 119,985 38,434

Rest of the world 878,113 68,355


Its more than agronomic potential that

determines Ag output Unmet yield potential of key production regions


Farm structures vary hugely between continents

Source: Food and Agriculture Organization of the United Nations, EU, 2010.

Increasing trade will play a role, but can’t

be the whole solution

Source: USDA/ERS 2011.

Net trade position in grain & oilseed

equivalents, 2000-2020f

Country Million tonnes

2000 2010 2020f

Egypt -14 -21 -28

Algeria -8 -10 -12

Saudi Arabia -9 -16 -21

China -10 -65 -74

India 3 6 0

Japan -48 -45 -43

South Korea -20 -22 -23

Source: Rabobank, Food and Agriculture Organization of the United Nations, OECD, 2011.

Case study: India’s so big, but so much

potential

India has the potential to be :

• One of the largest food markets in the world

• One of the top global exporters

• The home base for many Indian Multinational Corporations

• Agriculture represents 17.1% of GDP (2009)

• Employs 52% of the total workforce

• 126 million farming families engaged in

primary agriculture

• Average farm size – 1.41 Ha

• Favourable government policies

# 1 – Milk producer (108 million tonne)

# 1 – Cattle /buffaloes (283 mn)

# 2 – Arable land area (161 mn ha)

# 2 – Fruit and Vegetables (188 mn tonnes)

# 2 – Food grains (229 mn tonnes)

# 2 – Sugarcane (271 mn tonnes)

# 3 – Agri commodities

Number of US hog operations vs. US pork production

Source: USDA, NASS, 2011.

Farmer consolidation is one ingredient

to meeting the food challenge!

5,000

6,000

7,000

8,000

9,000

10,000

11,000

0

50

100

150

200

250

300

350

400 1986

1987

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

Hog operations Pork production

David Morgan

President, Syngenta Seeds, Inc.; Region Director - North America,

Syngenta

Did you know that…?

By 2050, global population will rise

by about a third to9 billionpeople

but

Global calorie demand will increase by

50%

Classif ication: PUBLIC

Source: FAO, World Bank statistics, Syngenta

Demand for food is driven by population growth and rising calorie consumption

World population> 80% of growth happensin emerging markets

19502.5 billion

20117 billion

20509 billionEmerging

Developed

Source: FAO, Syngenta analysis

0

1

2

3

4

1970 2000 2010 2030 2050

World demand for major crops*bn tonnes

+50%

* Includes cereals, rice, corn and soybean

FoodFeed


Environmental stresses are increasing

The change in climate is already reducing water and arable land . . .

Source: UNEP, Cline, Syngenta

Climate change impact

High

Medium

Low


1950 2030

1 hectare

fed 2 people

1 hectare needs

to feed 5 people

. . . requiring better use of existing farm land

Modern Agriculture has enabled real progress


Source: USDA, January 2010

We are growing more from less, but we need to do more

Environmental Benefits of Modern Agriculture


Agricultural production: emerging markets drive future growth


Global field crop production*Billion tons, est.

2020Avg

2007-2009

Rest of World

BRIC**~75% of

global productiongrowth

Developedcountries**

Source: FAO-OECD 2010/19 Agricultural Outlook, Syngenta Analysis

* Includes: wheat, oilseeds, rice, coarse grains

** BRIC = Brazil, Russia, India, China; Developed = NAFTA, EU, Japan, Australia

Challenges for global agriculture

● Huge rise in demand

● Limited farmland

● Limited water supplies

● Need to continue raising yields


Only sustainable approach is to

unlock the potential of plants

through innovation

We must grow more

from less

PLENE: Focus on efficiency and sustainability

The first integrated mechanized planting

system for sugar cane

Disease-free

Traceable

Genetic warranty

Cleaning and cutting

Treatment with Syngenta

technologies

Packaging

Minimal tillage

High productivity

Better use of

natural resources

Less manpower

Greater efficiency

Better working

conditions

Faster germination

Increased resistance

Complete crop

protection program

Greater convenience

and reduced cost

15%Cost reduction

for growers

Healthy seedlings

production at

Syngenta nurseries

Production and

processing units

Planting Labor Continued value

creation


in sugarcane: anticipating customer needs


TEGRA: transforming rice production

Securing yield and reducing labor for

smallholders: introducing a revolutionary

transplanting system

Preferred retailers place direct

Farmer orders

High quality treated seeds Integrated technology in

seedling tray

Agronomy protocol to maximize

yields

Transplant franchisees offer

seedlings-in-the-field

Nursery franchisees raise

healthy seedlings

30%yield advantage

150%return oninvestment


TEGRA™


PaniPipe


“If our new varieties had been

subjected to the kinds of regulatory

strictures and requirements that

are being inflicted upon the new

biotechnology, they never would

have become available.”

Norman Borlaug


Iris Yedidia

Group Leader, Agricultural Microbiology and Biotechnology,

Agricultural Research

The main challenges of Israeli agriculture

These limitations compel

Israeli agriculture to :

• Ensure A high degree of self supply

• Protect domestic produce

• Develop intensive production

• Maintain peripheral areas

Challenges:

•Shortage of water resources

• Scarcity of precipitation

• Two thirds of the land area defined

as semi-arid or arid

• Complex geopolitical environment

• Distance from export markets

Current research priorities & areas at ARO

• Facing agricultural threats (global & local):

- Climate change

- Food security crisis

- Alternative energy

• Precision agriculture (ICT = Information & Communication

Technologies)

• Agricultural biotechnology and its legal and societal regulation

• Market-oriented novel agricultural products

• Economics, marketing and rural development policy

Evolution of productivity in agriculture

and other sectors

Source: Bank of Israel.

Billi

on

$

Agriculture productivity and efficiency Productivity in different sectors

Potential irrigation water sources Irrigation technologies, purification and recycling, desalination

• Existing potable water resources (lakes, aquifers,

streams)

• Marginal water (saline water, recycled water)

• Rainfall enhancement

• Desalination

• Water saving: improved irrigation practices and

technology (precision agriculture, leak prevention,

drip irrigation), education

Moving irrigation systems

increased efficiency

Thermal imaging

water status

Grapvine, Kibbuts Yiftach

Over-Irrigation

Regular -Irrigation

Breeding

Functional plant biology at the Agriculture Research Organization

• Development of genetic material for

breeding programs, mapping genetic

markers for important genes in fruits

and vegetables

• Resistance to pathogens, drought

and salinity

• Extended seasonal productivity

•Effecting size & shape, pigments

• Enhancement of taste, aroma, shelf

life & quality (vitamins, antioxidants)

Resistance Non- resistance

Fruit breeding

Sample: pomegranate development at the ARO

Breeding for quality and

year round production

Technology development: agricultural engineering

and postharvest technologies

Automatic peeling and arils retrieving

Final product:

arils and peel

New Israeli

varieties

Netting technology

Climate and growth control

• Protection from environmental hazards

• Water saving

• Different colors for plant growth control

• Shadowing for climate control

• Pest control

Precision agriculture The right thing in the right place at the right time

• Site specific weed management

• Site specific pest management

• Spatial variability for disease control

• Thermal imaging – water status variability

• Over/under-application of resources

• Ground water contamination by chemicals

• Reduction in yield quality

Spraying

No Crop, no spraying

Development of new cultivation methods Cultivars selection, irrigation and technology assimilation

Oil quality

Irrigation Traditional

cultivation

Cultivation methods New plantations

Olive orchards:

• New varieties

• Use of recycled and brackish

water

• Transformation of grape-harvester

to olive-harvester

[email protected]

Dr. Iris Yedidia

Thank You

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