Global AgInvesting 2009 Conference Focuses on Opportunities and Sustainability
On June 22 and 23, I attended the Global AgInvesting 2009 conference in New York, sponsored by Soyatech. This week’s commodity report is a summary of the main themes covered during the two day event.
The timeliness of this conference attracted participants from all over the world, with a noticeably large representation of growers/land developers in South America. Further, the conference was generally very well attended with a mix of banks/funds, land investors, analysts and growers, without any one group being particularly dominant – the overall attendance directly contrasts with many of the recent commodity events that I have been to (and others that I have declined), most of which seem to be suffering from the broader effects of cost cutting and travel restrictions. The conference was marketed as an event to address the following questions:
- What are some of the demand drivers for crops over the next decade?
- What are some of the risks?
- Where will the new major croplands be developed?
- How will prices respond to these anticipated trends?
- Will the infrastructure be sufficient to handle projected demand?
- How can investors participate?
Day 1 – Supply, Demand & Infrastructure
The first sign of a good program is a diverse lineup of speakers. From my experience, most conference value actually comes from outside of the lecture, whether it be in poster sessions (this conference did not have any), coffee breaks or during the networking receptions. The speakers on the first day were certainly qualified in their respective areas. However, I did not come away from the morning sessions with anything particularly new or noteworthy. The first speaker of the day (Wayne Jones) is a division head at the OECD, providing a high level summary of their outlook as it pertains to changes in the primary driving fundamentals in global agri, and what to expect over the next decade.
When discussing price expectations for the global grain complex over the next 6-24 months, Mr. Jones did note that any price expectation is useless without a solid view on crude prices or biofuels expectations, but then did not provide a solid projection on either of these variables. So the overall outlook of 10-40% increases in basic food prices above current levels in the coming years loses meaning without taking these items into account. When addressing longer term trends, the usual suspects were discussed: population growth expectations, biofuel demand, land availability, and climate disruptions. But none of these were treated with any rigor.
The next speakers, from Bunge (BG) and Hi-Bred/Dupont (DD) respectively, provided more of the same. Mr. Elmore at Hi-Bred did however provide some interesting facts that I was not aware of (including, half of the world’s pork originates from China). It is not as though the first three speakers of the day all gave talks consisting of irrelevant facts…it is just that most people in attendance probably already know (or at least should know) most of what was discussed. I feel that at an agricultural commodities conference in the grains space, the presenters should assume a general level of knowledge of market fundamentals, and that most people would like to hear something that might not be currently ‘in the market’.
It was refreshing when Dr. William Wilsonof North Dakota State University provided his unique perspective on grains, with particular emphasis on wheat in the FSU. I encourage readers to look into Dr. Wilson’s research and extension work for his insight and expectations on the long term trends for FSU countries. As a researcher, I appreciate his perspective as someone who not only visits the areas where he is focusing on, but who is actively involved in intercontinental collaborations. The global perspectives of too many ag economists are shaped by weeks/months of sitting in offices, digesting work of others, with the obligatory annual visit (to say China or the Black Sea region) for a conference. Many academics who focus on the scientific and economic components of global agriculture offer something different, which includes getting out in the field, collaborating with numerous universities and governments, and actually seeing, touching and experiencing the subjects of their research. This is why the work of academics, particularly at land grant institutions, is a collective resource that is in my opinion severely underutilized by both the private and public sectors.
At the end of is talk, Dr. Wilson gave a shout out to the November 2008 issue of WIRED, which contained a great piece titled the Future of Food, which I appreciate.
Day 2 – Global Opportunities and Sustainability
I think that for those in the audience who came to AgInvest in search of new investment opportunities, the second day of the conference provided more of what they may have been looking for. Some unique insights were shared on land management and potential non-traditional land investment avenues. I particularly enjoyed the talk of Susan Payne, CEO of Emergent Asset Management. Ms. Payne, along the lines of Dr. Wilson, brings the perspective of someone with global on-the-ground experience, and a look into her portfolio and overall interest in future land development across several African countries will be an emerging investment theme for the coming years.
Thanks to SeekingAlpha for providing access to the conference.
The author attended the Global AgInvesting 2009 conference conference courtesy of Seeking Alpha. All Seeking Alpha authors are eligible to attend upcoming conferences for free.
This article was written by
