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Novus Poultry RoundtableFeeding the World and the Role of Poultry
Dr. Paul Aho - Poultry Perspective January 2010
[email protected], Connecticut USA
Conventional Wisdom Conventional Wisdom About Feeding the World About Feeding the World
More grain on less land with less water, More grain on less land with less water, plenty of grain for meat and biofuels plenty of grain for meat and biofuels
All problems can be solved with All problems can be solved with additional technologyadditional technology
Norman Boralaug versus Norman Boralaug versus Thomas Malthus Thomas Malthus
Unconventional WisdomUnconventional Wisdom
No shortage of technologyNo shortage of technology
Limits to biophysical Limits to biophysical systems (soil & water) systems (soil & water)
““Limits to GrowthLimits to Growth”” of 1972 of 1972
Trillions of Calories from Corn, Soybeans, Wheat and Rice Trillions of Calories from Corn, Soybeans, Wheat and Rice
02468
10121416
1960 1970 1980 1990 2000 2010 2020 2030 2040 2050
Price in Dollars Per Million Kcal
0
100
200
300
400
1970 1980 1990 2000 2010 2020 2030 2040 2050
66
Per Capita Consumption of Meat & EggsPer Capita Consumption of Meat & Eggs
7,000,000,000 people in 20107,000,000,000 people in 201043 Kg per Capita43 Kg per Capita
9,000,000,000 people in 20509,000,000,000 people in 205060 Kg or 30 Kg?60 Kg or 30 Kg?
77
MMT of Meat and Eggs in 2050 MMT of Meat and Eggs in 2050 Meat Now 60 KG 30 KG
Beef 56 94 25Pork 101 150 60Chicken 74 150 80Turkey 5 10 5Egg 68 136 100
Total 304 540 270
Additional Poultry and Egg Production
150 MMT increase between 2010 and 2050
40 MMT increase even with grain crash
Most of the increase will be in middle income countries in Asia, Eastern Europe, the Middle East and Latin America
World Poultry Production MMT 1985-2040
1030507090
110130150
1985
1990
1995
2000
2005
2010
2015
2020
2025
2030
2035
2040
ExpectedUnexpected
World Egg Production MMT 1985-2040
0
20
40
60
80
100
120
1985
1990
1995
2000
2005
2010
2015
2020
2025
2030
2035
2040
ExpectedUnexpected
Who is Competitive ?
Grain exporters and countries with low tariff barriers on feed ingredientsCountries with low labor CostsCountries with a good business climate
1212
Highest Per Capita Production of Corn Combined with Lowest Labor Costs
#1 Romania#2 Serbia #3 Hungary#4 South Africa#5 Brazil #6 Ukraine#7 Argentina #8 China #9 United States#10 Mexico#11 Thailand #12 Indonesia#13 Philippines #14 India #15 Egypt
Demographic Studies of the Demographic Studies of the 7 Billion People on the Planet 7 Billion People on the Planet
Where Will Poultry ConsumptionWhere Will Poultry ConsumptionGrow the Fastest?Grow the Fastest?
Income Quintiles in DollarsIncome Quintiles in Dollars
Income Per Capita.
Chicken kg/Per Capita
1 30,000 262 8,000 193 3,500 94 1,500 45 730 2
First Quintile First Quintile -- $30,000/ year$30,000/ yearUS, Europe, Japan US, Europe, Japan and rich everywhereand rich everywhere70% of world income70% of world incomeFurther Processed Further Processed and value added and value added productsproductsSlow Growth Slow Growth -- Not Not Income ElasticIncome Elastic
Second Quintile Second Quintile -- $8,000/ $8,000/ yearyear
Represented Represented everywhere US, everywhere US, Russia, Europe, AsiaRussia, Europe, AsiaBuy fresh and frozen Buy fresh and frozen cold chain chickencold chain chickenOld Engine of World Old Engine of World GrowthGrowth
Third Quintile Third Quintile -- $3,500/ year$3,500/ yearParts of China, India, Parts of China, India, Middle East, Latin Am.Middle East, Latin Am.
Wet/Cold Chain Wet/Cold Chain MarketMarket
Income ElasticIncome Elastic
New Engine of GrowthNew Engine of Growth
Fourth Quintile Fourth Quintile -- $4/ Day$4/ DayLatin America, Asia, Latin America, Asia, Africa, HaitiAfrica, HaitiThe Visible PoorThe Visible PoorChronic Grinding Chronic Grinding PovertyPovertyWet Market Wet Market Slow GrowthSlow Growth
Fifth Quintile Fifth Quintile -- $2/Day$2/DayAsia and Sub Asia and Sub Saharan Africa.Saharan Africa.Chronically Chronically UndernourishedUndernourishedUnimaginable Unimaginable Poverty and MiseryPoverty and MiseryNo GrowthNo Growth
Examples of large % Third Quintile Examples of large % Third Quintile Countries Countries –– Highest Potential GrowthHighest Potential Growth
South AfricaSouth Africa PanamaPanamaCosta RicaCosta Rica KazakhstanKazakhstanBulgariaBulgaria JamaicaJamaicaBelarusBelarus SerbiaSerbiaAlgeriaAlgeria PeruPeruIranIran ThailandThailandColombiaColombia China China AngolaAngola JordanJordan
2020
Peak World Oil Production? Peak World Oil Production?
0
20
40
60
80
100
120
1950 1970 1990 2010 2030 2050
Extraction of Oil from Wells in existence in 2010Extraction of Oil from Wells in existence in 2010Millions of Barrels/Day Millions of Barrels/Day
0102030405060708090
2010 2020 2030 2040
Oil Price – US $ Per BarrelOil Price – US $ Per Barrel
0
10
20
30
40
50
60
70
80
90
1998 2000 2002 2004 2006 2008 2010 2012
2424
Corn and Oil are Corn and Oil are Increasingly LinkedIncreasingly Linked
LongLong--Run Corn Price/Ton at Run Corn Price/Ton at Various Crude Oil PricesVarious Crude Oil Prices
CARD CARD ––Iowa State Iowa State
Oil Corn Metric
Corn Bushel
$ 50 $ 134 $3.35
$ 70 $ 188 $4.70
$ 90 $ 240 $6.00
Ethanol Percentage of the US Ethanol Percentage of the US Corn CropCorn Crop
048
12162024283236
2002 2004 2006 2008 2010
US Corn Use for Ethanol in MMT
0
25
50
75
100
125
150
2003 2006 2009 2012 2015
MMT of Feed Ingredients Consumed by the World Poultry
Industry 1985-2010
0
50
100
150
200
250
300
350
1985 1990 1995 2000 2005 2010
Feed Cost–Kg of Feed–Cents US
10
15
20
25
30
35
2005 2006 2007 2008 2009 2010 2011 2012
Feed Costs are at a New Higher Level
3030
Meat becomes a luxury for a Meat becomes a luxury for a larger part of the population during larger part of the population during
an economic recession. an economic recession.
A recession provides a preview A recession provides a preview of the limits of growth of the limits of growth
if such limits exist if such limits exist
World Economic Growth in %World Economic Growth in %
-3-2-101234
2007 2008 2009 2010 2011 2012
World Income – US$/ Capita
7000
7250
7500
7750
8000
8250
2006 2007 2008 2009 2010 2011
World Meat Per Capita World Meat Per Capita Consumption Consumption –– Kg (USDA)Kg (USDA)
34.0
34.2
34.4
34.6
34.8
35.0
2008 2009 2010 2011
World GDP Growth Rate & % Increase in World Chicken Meat Production
-2-101234567
1997 1999 2001 2003 2005 2007 2009 2011
Chicken GrowthEconomic Growth
FAO and World Bank
World Poultry ProductionWorld Poultry Production
4% Growth4% Growth20th Century20th Century
2% Growth2% Growth21st Century21st Century
Price of Corn Per Metric Ton Year 2000 Dollars – Chicago Price
19001900 $ 400$ 40020002000 $ 100$ 1002100 $ 2502100 $ 250
Inflation Adjusted Cost of Broiler Live Production (2000 $’s/kilo)
0.00
0.25
0.50
0.75
1.00
$/Kilo $0.80 $0.57 $0.54 $0.55 $0.60 $0.80 $1.00
1985 1990 1995 2000 2005 2010 2015
World Chicken and Egg World Chicken and Egg Per Capita Consumption Expected Per Capita Consumption Expected
0
2
4
6
8
10
12
14
1960 1970 1980 1990 2000 2010 2020 2030 2040
ChickenEgg
kg
World Chicken and Egg World Chicken and Egg Per Capita Consumption Unexpected Per Capita Consumption Unexpected
0
2
4
6
8
10
12
1960 1970 1980 1990 2000 2010 2020 2030 2040
ChickenEgg
kg
Factors that Influence the Factors that Influence the Consumption of Poultry & Eggs Consumption of Poultry & Eggs
Real income per capitaReal income per capitaDistribution of incomeDistribution of incomeCost of grainCost of grainPopulation sizePopulation size
Poultry Will Do Well Despite Poultry Will Do Well Despite Higher Grain Costs and Possible Higher Grain Costs and Possible
Grain Crisis Grain Crisis
Better feed conversion compared to beef Better feed conversion compared to beef and pork and pork
Beef 4 to 1 Beef 4 to 1 Pork 3 to 1Pork 3 to 1Poultry 2 to 1Poultry 2 to 1
Chicken Genetics YearYear WeightWeight FCRFCR MortalityMortality AgeAge
19251925 1.01.0 4.74.7 1818 112112
19651965 1.61.6 2.42.4 66 6363
20052005 2.42.4 1.71.7 44 4242
20452045 3.23.2 1.61.6 33 4040
Comparing Beef, Pork, ChickenComparing Beef, Pork, Chicken
Beef Beef -- 4 kg of grain, 365 days & 4 kg of grain, 365 days & 16,000 liters of water16,000 liters of water
Pork Pork -- 3 kg of grain, 180 days &3 kg of grain, 180 days &6,000 liters of water6,000 liters of water
Chicken Chicken -- 2 kg of grain, 42 days &2 kg of grain, 42 days &3,000 liters of water3,000 liters of water
World Chicken TradeWorld Chicken TradeIn Millions of Metric Tons In Millions of Metric Tons -- USDA to 2010 USDA to 2010
5
6
7
8
9
10
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
ConclusionConclusionRecessions provide a preview of the limits to growth if Recessions provide a preview of the limits to growth if there are limits to growththere are limits to growth
Poultry is the most sustainable major meat, Eggs arePoultry is the most sustainable major meat, Eggs arethe most sustainable animal proteinthe most sustainable animal protein
