Australia’s drought, climate change and the future of food
There’s a reason that few people are thinking about world grain supplies. Last year saw record worldwide production of grains and record stocks of grains left over.
But this year worldwide production slipped about 2 percent, owing in large part to the plunge in Australia’s production caused by an ongoing severe drought. Production is expected to fall 23 percent. Fortunately, in our globalized grain markets, this hasn’t affected overall supplies or prices very much as grain stocks are high and supplies are mobile and shipped all over the world as needed.
But Australia is the world’s fifth largest wheat exporter, accounting for nearly 9 percent of the total in 2016 according to the Food and Agriculture Organization of the United Nations. In fact, the top five wheat exporting countries account for 56 percent of world wheat exports. The rest of the world is highly dependent on these exporters to make up the difference between what they grow and what they eat.
But it’s not just wheat. For rice the numbers are even more striking. The top five rice exporting countries supplied nearly 80 percent of total world exports. For corn (called maize in most countries) the number is a bit higher. The top five corn exporting countries supplied almost 81 percent of all exports.
Why is this important? First, about 80 percent of all calories consumed come from grains, either through direct consumption (46 percent) or indirectly through livestock in the form of meat, milk, eggs and other animal products (33 percent). Second, as climate change begins to scorch the major grain growing areas of the world, the large exporters may find themselves with much less to export or even begin competing for imports.
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