Middle-Class Explosion Ahead

March 29, 2017 02:05 AM

Agriculture’s outlook appears bright for the long term 

When populations move from abject poverty to the middle class, a domino effect occurs. As people have more money, they start buying goods, services and experiences that were once only dreams.
Globally, spending among middle-class consumers is expected to almost triple by 2030, according to McKinsey & Company, a global management consulting firm. 

The sweet spot for agriculture is when a population boom occurs simultaneously with a fast-growing economy, according to Vikram Mansharamani, a lecturer at Harvard University and Yale University. 

This type of rapid two-part growth is happening in places such as Africa and India, he says, and the effects could potentially provide the demand shock the world needs. What will change? When people have more money, they tend to eat meat, drink wine, travel and buy cars and smartphones. 

“There will be a gigantic explosion in consumption,” Mansharamani says. As incomes rise and more consumers enter the middle class, diets tend to include more protein, dairy products and processed foods.

“Farmers will need to produce more food in the next 50 years than has been produced over the last 7,000 years,” says Moe Russell, president of Russell Consulting. “I’m very bullish on the future of America and production agriculture.”

Mansharamani points out: “A little more protein demand equals a lot more grain demand. More middle-class spending could be good for anyone involved with commodity markets.”

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Spell Check

bad axe, MI
3/31/2017 07:41 AM

  These guys better figure out how there going to stop the famine in Africa that's suppose to kill 16 million people in the next 6 months. You don't see these think tanks loading up our corn and taking it to save them. The trouble with the US they printed so much fiat currency to keep its service base economy going because we produce little to sell around the world to exist. The USA is going to have a hard time to take advantage of any middle class expansion because its cost of operation is to high . Russian farm land selling for $306.00 per acre ours selling for $12,000.00 an acre, hard to compete. You have to figure out what your going to do with the 68 trillion in debt before you worry about the middle class expansion , because were on are way of becoming a third world country . There goes 335 million people going from the middle class to developing country status.

Mark C. Daggy
Humboldt, IA
3/31/2017 11:48 AM

  Think of world assets as being somewhat finite. Also think of various countries economies as being like tanks of water. The US tank of water (economy) is full and the 3rd world countries tanks (economies) are nearly empty or empty. The globalist want to connect all of the countries tanks with lines and no valves. Guess what happens to the American tank or more truthfully has happened to our water tank (economy)? The purchasing power of Americans has decreased dramatically over the past 50 years. The globalist are the cause of the deterioration of an American's purchasing power for the purpose of amassing their great wealth. You can bet that very little of the wealth created in other nations will actually reach the American farmer's pocket. Big increases in commodity prices will be swallowed up by globalists cornering the market on our inputs. My position is....listen to none of them....go off grid as much as possible....invest with none of them....keep all of your grain in your own bins until they pay what your asking. If as a farmer in a rural area, you are currently frustrated with the way the masses in the populations centers in the US are voting wealth away from those that have worked for it? Can you imagine with a democratic global government where 50%+ in the far east literally vote the wealth out of countries like America.

Jim Weeber
Goshen, IN
3/31/2017 12:32 PM

  Shouted this same rhetoric from the mountain tops when I was a student at Purdue. That was 40 years ago. My dad heard the same stuff when he was a young man. He died at 100 in January. Don't be jumping into deep water over future prognostications like many have already done. I've seen a couple house cleanings throughout agriculture that whacked all but those who kept most of their equity unencumbered. Massive change predictions are usually inhibited by all kinds of unanticipated events including political impacts. Regarding distribution, especially food, advancement of peoples lifestyles and unintended consequences. Am I a little cynical? I'd be glad to tell you how I got that way sometime. Careful what you bet your farm on! A farmer is generally a "price taker" not a "price maker" and there in lies a big problem. This allows many to make a business out of the farmers business and they have weekends off.


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