While North America and EU countries currently dominate food production, power will shift to BRIC nations, warns the report, titled Power in Agriculture. “The EU has retreated from world markets as policies have changed [from boosting production to environmental management].
“The export capabilities of the EU in some key commodity sectors are predicted to decline further in the next 10 years unless policy conditions change markedly,” warns the report.
In the coming decades, EU countries will face increasing pressure to allow greater access to their markets. “This competition is likely to come from emerging nations – like China, India and Brazil – and will have implications for producers,” said the report.
Two factors are likely to speed the process. First, the opening up of agricultural markets through a gradual process of trade liberalisation and deregulation. Second, the increasing globalisation and concentration of the agricultural supply trade.
Moreover, some emerging nations have a strategic advantage in possessing key natural resources. “Our analysis shows a potentially grim picture for many of today’s powerful agricultural economies, including the US and Europe.
“In particular, European countries - including the UK - appear to be relatively poorly endowed in global terms with critical natural resources used in agriculture – such as land, water, potassium, phosphate, oil and natural gas,” according to the report.
Climate change is expected to exacerbate some of these changes.
Many emerging nations, such as Brazil, China and Russia, are better placed in terms of water and energy endowments but are vulnerable in terms of their possession of arable lands. This accounts for some large economies, particularly China, resorting to what the authors term ‘land-grabbing’ in Asia.
Unlikely to be sustainable
The report’s authors draw three main conclusions:
1) EU countries will face competition for land from countries such as China.
2) Water-, energy- and fertiliser-intensive agricultural production systems are unlikely to be sustainable in the near future.
3) EU countries need to balance their general level of agricultural efficiency – particularly in water use.
Speaking at the Oxford Farming Conference, Caroline Spelman, secretary of state for the Department for Environment, Food and Rural Affairs, said: “I read this as a call to the EU farming industry to become competitive – and grasp the many opportunities of globalisation and the need for sustainability.”
Terry Hehir, Australian organic dairy farmer, warned the conference that: “Land [in Australia] is already being procured in vast amounts by foreign countries to secure future food supplies.”
The Qatar government has already bought 170,000ha of Australian farmland, he added. It plans further investment to supply up to 35% of Qatar’s food supply from these farms.
Meanwhile, Brazilian agricultural exports soared by 24% last year to reach $94.6bn compared with the previous year.
Agriculture minister Jorge Ribeiro has identified a target of $100bn for this year.
The biggest importer of Brazilian food was China, which accounted for $16.5bn of purchases.
To read part one of this series, which focuses on the power of trans-national corporations, click here.