Food Security in Asia - a threat or an opportunity?

Finance Asia magazine (August 2011) published some interesting facts on the challenges for Asia in relation to Food Security:

  • The global population is expected to reach 9.5 billion in 2050
  • Asia is home to more than half of the world's population, and nearly two-thirds of its 925 million hungry people
  • Asia adds 65 million people per year to the global headcount
  • About 550 million people in Asia live in slums and squatter settlements
  • China has just 6% of the world's arable land, but 20% of the global population
  • As much as 40% of developing Asia will face severe water shortages by 2030
  • From June 2010 to February 2011, global food prices increased by 40.4%. Sugar increased 86%, cereals by 68% and edible oils by 66%
  • A 10% rise in domestic food prices in developing Asia could push an additional 64 million people into poverty
  • Food items consttute 30% to 40% of Asia's inflation basket
  • To produce one kilogram of beef requires seven kilograms of feed grain

(source: ADB, UN FAO, Farm Policy Journal, Habitat)

This week I attended the signing ceremony in Sydney to launch the $400m deal in which China's Bright Foods Group acquired a 75% stake in Australia's Manassen Foods. Bright Foods are now on the look out for more deals in Australia (click here for more details).

I believe that this is just the beginning of China's interest in Australia's food and agri sector, and that it won't be long before the level of activity in food/agri will start to look like the scramble we are witnessing for Australian resources.