Commodities | Apr 20 2015
Richard (Rick) Mills
Ahead of the Herd
As a general rule, the most successful man in life is the man who has the best information.
In 1798 32 year-old British economist Malthus anonymously published “An Essay on the Principle of Population” and in it he argued that human population’s increase geometrically (1, 2, 4, 16 etc.) while their food supply can only increase arithmetically (1, 2, 3, 4 etc.). Since food is obviously necessary for us to survive, unchecked population growth in any one area or involving the whole planet would lead to individual pockets of humanity starving or even mass worldwide starvation.
"The power of population is indefinitely greater than the power in the earth to produce subsistence for man.” Thomas Robert Malthus
Facts – Our topsoil is turning to dust and disappearing while at the same time we’re draining our fresh water aquifers faster than they can be recharged. Our atmosphere, the very air we breathe and earth’s armor against cosmic radiation is being poisoned and destroyed.
Viva the revolution
The second half of the 20th century saw the biggest increase in the world’s population in human history. Our population surged because of:
- Medical advances lessened the mortality rate in many countries
- Massive increases in agricultural productivity caused by the “Green Revolution”
The global death rate has dropped almost continuously since the start of the industrial revolution – personal hygiene, improved methods of sanitation and the development of antibiotics have all played a major role.
The term Green Revolution refers to a series of research, development, and technology transfers that happened between the 1940s and the late 1970s. The initiatives involved:
- Development of high yielding varieties of cereal grains
- Expansion of irrigation infrastructure
- Modernization of management techniques
- Mechanization
- Distribution of hybridized seeds, synthetic fertilizers, and pesticides to farmers
Tractors with gasoline powered internal combustion engines (versus steam) became the norm in the 1920s after Henry Ford developed his Fordson in 1917 – the first mass produced tractor. This new technology was available only to relatively affluent farmers and it was not until the 1940s tractor use became widespread.
Electric motors and irrigation pumps made farming and ranching more efficient. Major innovations in animal husbandry – modern milking parlors, grain elevators, and confined animal feeding operations – were all made possible by electricity.
Advances in fertilizers, herbicides, insecticides, fungicides and antibiotics all led to better weed, insect and disease control.
There were major advances in plant and animal breeding – crop hybridization, artificial insemination of livestock, growth hormones and genetically modified organisms (GMOs).
Further down the food chain came innovations in food processing and distribution.
All these new technologies increased global agriculture production with the full effects starting to be felt in the 1960s.
Cereal production more than doubled in developing nations – yields of rice, maize, and wheat increased steadily. Between 1950 and 1984 world grain production increased by over 250% – and the world added a couple billion people more to the dinner table.
The modernization and industrialization of our global agricultural industry led to the single greatest explosion in food production in history. The agricultural reforms and resulting production increases fostered by the Green Revolution are responsible for avoiding widespread famine in developing countries and for feeding billions more people since. The Green Revolution also helped kick start the greatest explosion in human population in our history – it took only 40 years (starting in 1950) for the population to double from 2.5 billion to five billion people.
We goosed agra machine’s growth and at the same time, through better sanitation and the use of antibiotics, we saved a billion people who birthed a billion and more.
The Revolution is dead
Unfortunately the effects of the green revolution are fast wearing off and the true cost to our environment is only now becoming apparent.
The production advances of the Green Revolution were real. But by any yardstick the Green Revolution, while a true, almost global agricultural revolution, was not as green as many think – there was heavy collateral damage:
- Agricultural output did increase as a result of the Green Revolution, but the energy input to produce a crop increased faster – the ratio of crops produced to energy input has decreased. This is because High Yielding Varieties (HYVs) of seeds only outperform traditional varieties when adequate irrigation, pesticides and fertilizers are used
- Green Revolution agriculture produces monocultures of cereal grains. This type of agriculture relies on the extensive use of pesticides because monoculture systems – with their lack of genetic variation – are particularly sensitive to bug infestations
- The transition from traditional agriculture to GR agricultural meant farmers became dependent on industrial inputs – not made on the farm inputs. Farmers faced severely increased costs because they now had to purchase such items as farming machinery, fertilizer, pesticides, irrigation equipment and seeds
- The increased level of mechanization on larger farms removed a large source of employment from the rural economy. New machinery – mass produced gas tractors, large self propelled combines and mechanical cotton pickers – all combined to sharply reduce labor requirements
- Less people were affected by hunger and died from starvation – but many more are affected by malnutrition such as iron or Vitamin A deficiencies. Green Revolution grains do not have the same nutritional values as traditional varieties. The switch from heavily rotated multiple crops to mono cropping or dual cropping reduces total soil fertility and the nutritional value of our food
- The Green Revolution reduced agricultural biodiversity by relying on just a few varieties of each crop. The food supply could be susceptible to pathogens that cannot be controlled by agrochemicals
- Many valuable genetic traits, bred into traditional varieties over thousands of years, are now lost
- Wild plant and animal biodiversity was hurt because the Green Revolution expanded agricultural development into new areas where it was once unprofitable or too arid to farm
- The 20/80 phenomenon – the rapid increase in farm size and the concentration of production among large producers means 20% of producers generate 80% of the agricultural output
- As a result of modern irrigation practices, aquifers in places like India and the US mid west have become depleted. There are two types of aquifers: replenish able, most of the aquifers in India and the shallow aquifer under the North China Plain are replenish able – depletion means the maximum rate of pumping is automatically reduced to the rate of recharge. For fossil, or non-replenish able aquifers – like the U.S. Ogallala aquifer, the deep aquifer under the North China Plain, or the Saudi aquifer – depletion brings pumping to an end. In the more arid regions like the southwestern United States or the Middle East the loss of irrigation water could mean the end of agriculture in these areas
- Green Revolution techniques rely heavily on chemical fertilizers, pesticides and herbicides, some of these are developed from fossil fuels which makes today’s agriculture regime much more reliant on petroleum products
- Farming methods that depend heavily on chemical fertilizers do not maintain the soil's natural fertility and because pesticides generate resistant pests, farmers need ever more fertilizers and pesticides just to achieve the same results
- The increased amount of food production led to overpopulation worldwide
By 2050, the world's population is expected to reach 9.6 billion people. Norman Borlaug, the Father of the Green Revolution, is on record stating he believed that 100% adoption of Green Revolution practices (and adaptation of well advanced research in the pipeline), could feed 10 billion people on a sustainable basis.
"Future food-production increases will have to come from higher yields. And though I have no doubt yields will keep going up, whether they can go up enough to feed the population monster is another matter. Unless progress with agricultural yields remains very strong, the next century will experience sheer human misery that, on a numerical scale, will exceed the worst of everything that has come before". Norman Borlaug
Unfortunately the high yield growth is tapering off and in some cases declining. This is in large part because of an increase in the price of fertilizers, other chemicals and fossil fuels, but also because the overuse of chemicals has exhausted the soil and irrigation has depleted water aquifers.
Dr. M.S. Swaminathan, to rice what Borlaug was to wheat, said: “Stagnation in productivity is due to depleting natural resources base such as a steep fall in ground water table, impaired water quality, increasing input cost – particularly diesel, deficiency of micro-nutrients in the soil, deteriorating soil health, and high indebtedness of farmers.”
Consider also…
Narrowly focusing on increasing production as the Green Revolution did cannot alleviate hunger because it failed to alter three simple facts – an increase in food production does not necessarily result in less hunger – if the poor don't have the money to buy food increased production is not going to help them.
Secondly, a narrow focus on production ultimately defeats itself as it destroys the base on which agriculture depends – topsoil and water.
And thirdly to end hunger once and for all, we must make food production sustainable and develop secure distribution networks of needed foodstuffs.
Price spike in the cost of survival
There are currently 7.3 billion of us sharing the planet. Here’s today’s conditions for the world’s poorest…
Because our agriculture system is concentrated on producing a very few staple crops there is a very serious lack of crop and production location diversity. Corn, wheat, rice and soy are the main staples and production is oftentimes half a world away from where the majority of the crop would be consumed. The world’s extreme poor exist almost exclusively on what is a ‘buy today, eat today’ plant based diet – wheat, corn, soy or rice provide the bulk of their calories.
Almost half of the planets population lives on less than $2.50 a day – roughly 1.4 billion people live on less than $1.25 per day. On average developing countries citizens spend a much larger percentage of their wages on food than do their counterparts in developed nations. Some published estimates are as high as 50 to 60 percent of income going towards food.
When food prices soar these people lack the money to feed themselves and their children – when your living on a couple of dollars a day, or less, and most of your income already goes to feed your family there’s no money to cover a price spike in the cost of survival.
Almost 1 billion people already go to bed hungry each night and somewhere in the world someone starves to death every 4 seconds – most on this tragic roll call are children under the age of five.
Malthusian pessimism
Malthusian pessimism has long been criticized by doubters believing technological advancements in:
- Agriculture
- Energy
- Water use
- Manufacturing
- Disease control
- Fertilizers
- Information management
- Transportation
would keep crop production ahead of the population growth curve. The way we treat our most precious natural resources, the earth’s topsoil, water and air has convinced me to give that conclusion a huge doubt.
Humans are currently withdrawing more natural resources then our Earth bank is able to provide on a sustainable basis. How much more? At today’s rate of withdrawal we need another half earth.
The headline projection of the latest UN study says the world’s population is likely to grow by another 2.3 billion, to 9.6 billion people in 2050 – that’s 68.5 million people expected to be born every year between 2015 and 2050.
By 2030, food demand is predicted to increase by 50% and 70% by 2050.
Consider:
- Global abnormal weather. Record setting droughts, flooding, hailstorms, cold snaps all exacerbated by climate change
- Exploding populations
- Eastern diets shifting to a western style one and food to fuel
- Aquifers are being depleted faster than natural refreshment rates
- Desertification
Conclusion
In his Nobel lecture of 1970, Borlaug stated: “Most people still fail to comprehend the magnitude and menace of the population monster. The rhythm of increase will accelerate…unless Man becomes more realistic and preoccupied about his impending doom.”
The ghosts of Thomas Robert Malthus and Norman Borlaug haunt our broken agra machine and an almost indecipherable whisper can be heard…we warned them.
Food, water and air. Since they are kinda important to our well being shouldn’t all three be on our radar screens? It’s obvious they are on mine, are they on yours?
If not, maybe they should be.
Richard (Rick) Mills
Richard is the owner of Aheadoftheherd.com and invests in the junior resource/bio-tech sectors. His articles have been published on over 400 websites, including:
WallStreetJournal, USAToday, NationalPost, Lewrockwell, MontrealGazette, VancouverSun, CBSnews, HuffingtonPost, Londonthenews, Wealthwire, CalgaryHerald, Forbes, Dallasnews, SGTReport, Vantagewire, Indiatimes, ninemsn, ibtimes and the Association of Mining Analysts.
If you're interested in learning more about the junior resource and bio-med sectors, and quality individual company’s within these sectors, please come and visit us at www.aheadoftheherd.com
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Legal Notice / Disclaimer
This document is not and should not be construed as an offer to sell or the solicitation of an offer to purchase or subscribe for any investment.
Richard Mills has based this document on information obtained from sources he believes to be reliable but which has not been independently verified.
Richard Mills makes no guarantee, representation or warranty and accepts no responsibility or liability as to its accuracy or completeness. Expressions of opinion are those of Richard Mills only and are subject to change without notice. Richard Mills assumes no warranty, liability or guarantee for the current relevance, correctness or completeness of any information provided within this Report and will not be held liable for the consequence of reliance upon any opinion or statement contained herein or any omission.
Furthermore, I, Richard Mills, assume no liability for any direct or indirect loss or damage or, in particular, for lost profit, which you may incur as a result of the use and existence of the information provided within this Report.
