Happy New Year!
This is as good of a time as any to remind ourselves that the North American agricultural industry may be the last bulwark for creating real wealth in our economy.
We’ve talked about this before. There are only three ways of creating true and lasting wealth: manufacturing, mining and farming.
Since we’ve apparently given up on much of manufacturing over the past few decades, and are doing nearly everything we can to discourage mining, this only leaves us with agriculture. And as hard as some are trying to discourage farming, the fact is that the number of people who need food is beginning to outstrip the world’s capability to produce it.
The fastest growing markets for U.S. agriculture today are in the Pacific Rim — China, Vietnam, South Korea, the Philippines, Indonesia and Australia.
According to USDA, ag exports to this region will reach $62 billion this year, the value of which is triple what it was 10 years ago.At $12 billion, exports to Southeast Asia alone have doubled since 2009. For the first time, this region’s purchases of U.S. ag products surpassed that of the European Union. Meanwhile, exports to the EU are projected to hit $11 billion in 2012 compared with $10 billion last year.
Sales of U.S. ag exports to the Middle East and northern Africa have tripled since 2001 and are anticipated to reach $12 billion this year. Nearly half of this will go to two countries, Turkey and Egypt. And they’ll purchase almost anything they can get their hands on: exports of hay (specifically alfalfa) will exceed 700,000 metric tons this year.
Farm exports to Latin America has nearly tripled in value over the past 10 years and are expected to reach $12 billion this year.
Besides Argentina and Brazil, North American farmers are the only producers capable of feeding much of the world. If we’re allowed, some way, somehow, we’ll figure out how to continue to do so.
From the equipment side of things, according to the Assn. of Equipment Manufacturers, through the first half of 2011, U.S. exports of farm machinery were $5.6 billion, which was up 15% compared with the first half of 2010.
Do farm equipment dealers have any role in this bigger picture of worldwide agriculture?
Of course you do, because you’re responsible for keeping our farmers up and running. Whether you look at worldwide agriculture as your business or not, your role is only going to grow as do the markets expand for food made in America.