Food Shortages, Fresh Water Shortages, Population Growth, Serious Bubbles
Many more of the world’s population will be living with malnutrition and starvation in the not to distant future. As many as one billion people today are considered under fed. Ultimately many do not survive due to inadequate clean fresh water supplies and current poor crop production.
The Potash and BHP merger potential may be the headline of the day on Wall Street but the real story is about the World’s food supply, and the water required to grow it. The world’s population is projected to increase by an extra 2.2 billion people by 2050, according to UN projections. Food production needs to increase by 70% by some estimates.
Potash is all about fertilizer and increased crop production, and fertilizer has a hot future. Food demand may prove to drive the largest M & A deals of 2010.
However, fertilizer without water is not going be much help for the extreme demand on limited food supplies.
Water is the life blood of it all, and water rightsare going to be the ultimate bottom line issue.
Floods, drought, warming climates can and are wiping out huge harvests this year. India, China, United States, Russia, Africa, and most recently Pakistan all have issues.
Water tables are falling in agricultural regions around the world. In the United States nearly every region of the country has some area of concern.
California’s Central Valley and the drainage basin that supplies that water have lost enough water fill the nations largest reservoir Lake Mead since 2003. The California Central Valley is one sixth of this nations irrigated land.
Over drafting and the falling water tables of the Ogallala aquifer are clear. If they continue to over pump the nations largest aquifer, its days of supplying ancient water are numbered.
An eleven year drought is ravaging the Southwestern United States, the Colorado River basins Lake Mead recently fell to a level not seen since the mid 1950s. Las Vegas could run completely out of its water supply and Hoover Dam could stop generating electricity. Demand on this water supply has increased dramatically since the 50’s.
So while merger and acquisition news dominate Wall Street, the real story behind the news is the demand for increased agricultural production and the increased demand is expected to grow rapidly over the next few decades, as the global population expands. Potash is seen as crucial to increased crop yields to help prevent these future food shortages.
According to Potash Corp, many more people are consuming more protein and meats like Beef Cattle and as incomes rise in developing nations, millions more people will switch from starch based diets to protein based diets. “Every pound of beef requires seven pounds of grain to produce, and hundreds of gallons of water, this will have a substantial impact on food demand.”
All the potash in the world is not going to do us much good without the fresh water required to sustain life and raise crops. Nevada water rights are considered an appurtenance to the land, they can be sold with the land.
China has 20% of the world’s population but just 6% of its arable land. The ratio between the number of people and the amount of productive arable farm land continues fall. World wide the falling amount of productive land per person will soon begin to accelerate, do to climate change, soil erosion, water shortages, and population increases.
So with the supply of productive arable farm land with adequate fresh water shrinking everyday, while demand is exploding. The future is very clear.
If you think the real estate bubble and current economic down turn is traumatic, just wait. The impending food, water, and population bubble is going to leave us all longing for the good old days when all we had to worry about was asset values and money! Perspective on what is truly important and what is superficial.
Water will prove to be more valuable than all the money and fertilizer in the world.
Irrigated farm and ranch land with water rights is available for sale today.Irrigated Farm and Ranch Land with Water Rights in Nevada