25,000 an Acre And Producing Food for a Hungry World

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Last week here in Ontario a Perth County farmer tweeted out a few pictures of farms that were sold at public auction for approximately $25,000 an acre.  Of course these are very high prices in Ontario and it’s been the talk of the #ontag twitterverse ever since.  While Midwest farmland prices have retreated this year it seems like Ontario hasn’t followed that path.

There are many reasons for that, probably too many to describe in this column.  I had the same question last year in St. Hyacinthe Québec.  I had given a grains presentation and in the question-and-answer period afterwards I was asked about land prices.  Phil, here in St. Hyacinthe, land is selling for $20,000 an acre.  Do you think it will continue?  I spit out an answer, but I’m even a bit recalcitrant about giving my opinion about the price of corn, so I don’t know if it made much sense.  Needless to say, all of this land is producing food for a hungry world.  However, the disparity in fixed land prices to get that done seems incredible.

We will leave that to discuss sometime maybe in 2017.  Let’s just say that this land produces food, and in both of these locations the dairy industry is a big part of the equation.  So from this land we get milk and cheese and butter and a whole host of other dairy products that helps keep the human race nurtured.  Ditto all along down the line whether it’s beef, grain or some type of vegetable crop.  As farmers, we might have a lot of variables in the mix like land prices, but at the end of the day we produce food for hungry world.  The fun part of course is figuring out how the demand for such food pans out.

That’s one reason I get to analyze futures and cash markets.  However, I like to look at the dynamics of food demand much closer up.  As many of you know I’ve traveled to many parts of this world and have seen all kinds of crops in all kinds of different places.  I still have not made it to Brazil or Argentina, but I’m hoping that will come soon.  I am due back in Asia on a moments notice.  A little political insurrection kept me away from being there next month.

It is there in Bangladesh where I get to witness the dynamics of food demand close-up.  Some of you might remember a column I wrote several years ago about a boy in Comilla, Bangladesh.  It was 1993 and I was on my first trip to Bangladesh.  I was moving through the country on a train and when the train stopped it was inundated with people begging for something to eat.  Things have changed over the last 24 years since then.  In fact, when you are in Bangladesh now there is a tangible difference in poverty levels.  People are getting more to eat; there is a big difference on the street.  However, back in 1993, malnutrition was a far greater threat to a huge population.  I was not ready for that.

I was not ready because in our society food is ubiquitous.  It is everywhere and it is cheap.  The reason it’s everywhere is because we celebrate with food.  Whether you go to a party, whether you go to church, wherever you go there is food.  It is also sold in a myriad of retail locations and it is cheap.  As a percentage of our disposable income, Canadians continue to enjoy a declining percentage. In fact, obesity has become a scourge, mainly because food is ubiquitous and cheap.

On the other side of the world in Bangladesh in 1993, it was not. Beggars were everywhere.  It was shocking and it made me feel conspicuous and somewhat alarmed to see the state of human depravity.  I found the site of hungry kids to be something that burned in my memory.

At some of these stops we would hand food out the windows of the train, but it often turned into a free-for-all as hungry people simply overwhelmed others trying to get something to eat.  At the Comilla stop, one little boy fell as he was grasping for food and his head hit the steel rails and he started to cry.  That was the image that I was left with as the train pulled away.  I felt overwhelmed with the horror of that kid’s reality.

Of course I am a Canadian farmer and I produce food for myself and probably 150 other people.  Our productivity has become so great here, that food is ubiquitous and the land that we produce the food on in Ontario and Quebec is now valued in the stratosphere.  At the same time I have never lost sight of the fact I’ve stared hunger in the face on the other side of the world.  Somewhere in the mix, I hope I’m making a difference.

I’ve been back to Comilla Bangladesh many times since that day in 1993.  The last time I was there I ate breakfast in a roadside café.  Things seemed better for everybody that day.  I just hope that little boy got his.  I want to wish all of you a Merry Christmas.