NEW YORK--(BUSINESS WIRE)--Global food & agribusiness (F&A) faces a remarkable conundrum. Right now the sector is struggling in an operating environment characterized by slow growth, soft demand and ample supply, which in combination are challenging business confidence. Yet the sector has a bright future. Over the longer term, growth in global F&A will be strong, driven by a powerful combination of population expansion, rising wealth and urbanizantion.
So how can global F&A navigate its way through the sluggish operating environment it finds itself in towards the stronger growth that lies ahead? How can it find new ways to profit through the current uncertainties while positioning and preparing for future opportunities?
In its 2014 flagship report “Unleashing The Potential For Global F&A - A Call For Innovation And Leadership,” which was presented in Washington during the Duisenberg Lecture held in conjunction with the IMF and World Bank Annual Meetings, Rabobank has developed ten big ideas in global F&A aimed at boosting global food availability and improving access to food over the next decade.
These ten ideas are:
1. Adopt big data in U.S. agriculture, boosting grain and oilseed production and resource efficiency, leading to another 20 million tonnes of grain and oilseed output by 2025.
2. Close the yield gap in Central and Eastern Europe, consolidating F&A to increase production. This will create an additional nine million tonnes of grain production over the next decade.
3. Improve China's food security, taking domestic actions to complement agriculture imports. This will drive a 61 million tonne improvement in grain production and a three million tonne lift in oilseed output by 2025.
4. Strengthen South-South trade, linking South America’s production potential to Asia’s demand, leading to another 20 million tonnes of soybean trade from South America to China over 10 years.
5. Invest in local storage, reducing post-harvest food losses in Sub-Saharan Africa and creating an 8 million tonne increase in grain and oilseed availability over the next decade.
6. Boost production in the F&A engine room, capitalizing on Brazil’s grain and oilseed and animal protein potential. This will create an 11 million tonne lift in meat production and a 22 million tonne increase in grain and oilseed output by 2025.
7. Develop cold chains in China, leading to a 40 million tonne increase in meat and seafood availability over 10 years.
8. Grow aquaculture, kickstarting the tilapia industry in Latin America and increasing production by two million tonnes by 2025.
9. Lift dairy production in India, improving rural incomes and increasing output by the liquid milk equivalent of 30 million tonnes over the next decade.
10. Raise sugarcane's productivity, improving consistency of yields and cane quality in Brazil, and boosting sugar output by 16 million tonnes by 2025.
Rabobank argues that a stronger focus on innovation is needed to move these ideas forward and provide the all-important bridge between the near-term challenges and the longer-term opportunities for global F&A. Innovation can and should help global F&A to do more with less—that is, increase food availability and improve access while stepping more lightly on the planet. However, while innovation may be the key ingredient, leadership will be the single most important tool in overcoming these difficulties and putting these big ideas into practice.
“This leadership will come from CEOs of global and local F&A companies, from investors in global F&A, from scientists with the ability to promote new and improved technologies and practices, from government experts, from NGOs, from international networks, and from international commercial and institutional banks. Where these leaders sit is not what sets them apart - it is their vision, the way they drive the case for change and their ability to inspire action that differentiates them,” said Wiebe Draijer, Rabobank Executive Board Chairman.
The report argues that harnessing innovation requires a shift in mindset and an acceptance that business as usual is not likely to be the right way forward. Although global F&A has seen much change over the past decade, there is still some reluctance to appreciate how different global F&A is going to have to be in order to successfully respond to the significant constraints that come with the long-term opportunities.
Rabobank suggests that innovation should be focused in two areas. The first is in basic research and development (R&D), to discover new technologies and practices that are implementable at a commercial scale. The second is in business models, which need to change to accelerate the take-up of new technologies and practices in ways that better manage risk and better align investments and returns.
Although there are some significant hurdles ahead, Rabobank is positive about the sector and confident in the ability of global F&A to rise to the challenge. The future of global F&A requires leaders with the confidence to invest in the future by thinking big and embracing change.
Wiebe Draijer, Rabobank Executive Board Chairman, presented the report to Mr. Dave MacLennan, President and Chief Executive Officer of Cargill during the Duisenberg Lecture. MacLennan said, “Cargill is optimistic about the ability of the world to feed itself.” MacLennan said that despite many challenges, including climate change, he sees a lot of upside. “Africa is critical to feeding the planet’s growing population. We have huge opportunity and challenge within our grasp.”
Wiebe Draijer conveyed his congratulations to MacLennan on a speech full of vision and hope for the future. “I am impressed by the coalitions that are formed worldwide to address the challenge of feeding a global population of 9 billion people – or even more. Rabobank is committed to continue its financial services delivery to the F&A sector and aims to play a leading role in international coalitions focused on increasing food and nutrition security.”
Rabobank Group
(www.rabobank.com) is a global financial services leader providing wholesale and retail banking, leasing, real estate, and renewable energy project financing. Founded over a century ago, Rabobank is one of the largest and safest banks in the world, with nearly $1 trillion in assets and operations in more than 40 countries, and ranks among the highest rated private banks by Standard & Poor's and Moody's. In North America, Rabobank provides wholesale banking services to leading food and agribusiness, renewable and “traditional” energy, metals, and financial institution clients, as well as leasing services, retail banking in California, and agricultural production lending across the U.S. Rabobank. The Financial Link in the Global Food Chain.®
About the Duisenberg Lecture
Now in its eleventh year, the Duisenberg Lecture addresses topics close to the bank’s heart as a leading food and agribusiness bank, and topics that are relevant to the international development agenda. The event is named after the late Dr. Wim Duisenberg, former President of the European Central Bank and Vice-Chairman of the Executive Board of Rabobank Nederland (1979-1981).
Wiebe Draijer, Executive Chairman of Rabobank’s Executive Board, presented the Report to Mr. Dave MacLennan, President and Chief Executive Officer of Cargill at the 2014 Duisenberg Lecture held in Washington DC.
For your social media ready version of this press release: http://rabobank-food-agribusiness-research.pressdoc.com
Follow us on Twitter: @rabofoodagri
NOTE
- The report/presentation attached is sent specifically to enable journalists to do their work, i.e. as the basis for an article or news report, or as preparation for a telephone or personal interview with a content expert. In line with good journalistic practice, a reference to the source would be appreciated.
- Please note that it is expressly forbidden to forward the attached report/presentation in any form to third parties, or to publish this report either partially or entirely on a website.
- Rabobank has recently updated the distribution lists for Food & Agribusiness Research reports. If you have no interest in further receiving this information, please let us know and we will remove your email address promptly.
_____________________
Rabobank Nederland
Communication Department, PO.Box 17100, 3500 HG
Utrecht, tel. +31 (0)30 21 6 2758, pressoffice@rn.rabobank.nl