Food prices are increasing and experts are saying our resources are hitting the wall. We are consuming more, stockpiles are down, and arable land is becoming a scarce commodity.
Lincoln University's Farm Management and Agribusiness Professor, Keith Woodford said world grain stockpiles are down from 25 percent to around 10 percent, which is "only enough to get us through six weeks".
Last month food riots rocked Mexico, Somalia, Senegal, Egypt, Haiti and many other countries.
The current shortages are forcing many countries to look at their reliance on overseas supplies of food. The Philippines has banned conversion of farmland for development and threatened rice hoarders with life imprisonment. India is discouraging rice exports by hiking up its export duty; Bangladesh and Cambodia have a current ban on rice exports, while Vietnam is limiting their exports.
"This sort of presents a message to other countries that have been importing the rice – 'hey, this isn't a great situation to be reliant on these other countries'," Professor Woodford said.
Although he does not think there will be a mass starvation, basic foodstuffs will cost a lot more.
"There are some arguments for being self sufficient in the basics."
New Zealand imports around half of its food.
At the moment there are around six billion people in the world, and estimates suggest it will increase over the next 50 years to about nine billion.
In most of Asia, yields stopped increasing after the "green revolution" in the 1970s, 80s and 90s, Professor Woodford said, and land is going out of production into cities, and other things.
"There is some conservation land in places like the United States and Europe that could be brought back in, but essentially we are using all the land that is available."
Grains being grown for biofuels are also taking vast areas, such as in the mid-west of the United States.
"So we are running into resource constraints all over the place," Professor Woodford said.
New Zealand's Changing Landscape
When Professor Woodford looks at New Zealand's future in horticulture and farming, he believes everything will change.
"I am not clever enough to work out what it is going to be like. What I am convinced is—there are some really major things happening in the world and they all relate to resource constraints. Up until now... well, technology has always kept things—like our crop yields—increasing faster than supply, so we have had cheap food," he said.
Technology has produced higher wheat yields in New Zealand than thirty years ago and our lambs are bigger, with a higher lambing percentage, he said, but other factors are now taking their toll.
"We are just moving into another phase with sheep farming. Because of the drought and because of the unprofitability of sheep, and also what is starting to happen now, is because of the increase in prices in fertiliser, we are going to see quite a downturn in the number of lambs produced."
Shifting to Grain Production
"Now we are seeing a shift back in the South Island to more grain—there is a lot more barley being grown and feed wheat being grown."
"This last season, which has only just completed a month or so ago, is the first sort of time we have had an increase, and that is going to occur again this following year. So farmers are shifting back again into grains."
Farmer Don Coles left his sheep and beef farm in the King Country and is now growing grain in North Waikato because the economics stack up in the current climate. He said the restrictions on clearing native vegetation meant he lost his rights to develop his land for farming.
"There are a lot of issues very much up in the air and we are getting far more regulated and controlled in our activities. We got out of the King Country... [and swapped] over a sheep and beef property to a grain and silage property that looks to be 4-5 times more profitable," he said.
His maize is grown for the dairy industry for feed, but with the current world grain shortages, Mr Cole speculates that in the future more maize will be grown to target the 'people' market.
There is a lot of uncertainty in the industry, said Mr Coles, who has been farming for more than 40 years.
"The biggest problem is the Kyoto issue. If that is taken to the extreme it will probably destroy farming. If you actually go through it work through the figures, we will just have to stop producing. It is ridiculous."
Food Security Through Diversity and Traditional Methods
Spokesperson for the Soil & Health Association Steffan Browning said lack of diversity leaves economies vulnerable.
"I certainly see that we are reducing our options by choosing a few currently, relatively high-value, products."
He said high rates of grape and dairy conversions limited diversity. In Marlborough he has seen fruit orchardists, vegetables growers, and seed and crop growers convert to grapes.
"If you look at the map, it will blow you away just how dominant grapes are in the plains of Marlborough—it is just huge. Now, the economy is probably just fine in terms of dollars flowing, but not from the diversity. If there was a major hit on grapes our economy is so vulnerable—there are sheep and beef in the hills and there are mussels in the sea—but you run out about then.
"Research is showing that people living and growing in their more traditional manner with their more traditional varieties, it's far more sustainable, their soil structures are being left fine, their food is more guaranteed, they are not under the price whims of international markets and their soil actually builds up and is in better condition and tolerates the weather issues better as well," Mr Browning said.
Fertiliser Costs Driving Up Food Prices
According to a World Bank index, global fertiliser prices have increased five-fold in the last two years, Professor Woodford said.
He said huge changes are occurring and New Zealand will feel the full impact in the coming weeks and months. Dairy prices have been so good that dairy farmers don't have to think twice when it comes to putting on fertiliser, he said.
"But on sheep farms with the low prices for the product combined with the increasing price for the fertiliser itself, and the quantities going on this year are much much lower," he said.
"Basically, dairy farming is highly profitable whereas sheep farming is a real, real, struggle."
Te Akau farmer Don Coles said fertiliser prices will probably drive the cost of the maize farming up another $300-400 per hectare. But he said this was still feasible for farmers with more than a $1000 per acre net profit margin.
Soil & Health's Mr Browning said organic foods better reflect the true cost of production, than "conventional" food production methods heavy in pesticides and chemical fertilisers.
He said the cost on the environment, polluted water ways, dying lakes, the toll the pesticides in food have on human health should be factored into the price of the bread or the pasta sauce bought at the local store.
"But if it is grown organically and people haven't had the subsidies of synthetic fertilisers and fast acting pesticides and fungicides organic growers are far closer to true cost of production."
Intensive Dairy Farming Driven by Economics
Professor Keith Woodford said dairying has seen a few years of economic growth worldwide and the intensification of dairy is purely driven by economics.
"It is China and India and other parts of Asia, and also the Middle East—demand has just increased that little bit more than supply and prices have just rocketed away. Where they are going to go the next couple of years is just anybody's guess," he said.
"We are seeing quite substantial conversion of sheep farms to dairy farms—and it is capital intensive, it is costing a lot of money—but the economics do stack up."
He said the area around the Waimakariri right through to North Otago used to be a mixture of sheep and cropping, but now there is pressure to convert more of this farmland to dairy.
Dairy and beef farmer Graham McBride, who also sits on a high-level Agri Food Forum in the United States each year, whose job is to look at emerging trends in the food chain, said he was shocked by what he has seen happening throughout the Waikato.
"There is land that a decade ago you wouldn't have dreamed of putting into cows. He said people are going to farm intensively "on the side of some of the hill faces that I have seen, and I can't see anything else but environmental problems."
Part 2 of 'Future of food: Our changing lanscape' will feature in the next edition of The Epoch Times.
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