Last week's Economist carried a feature on a recent wave of farmland purchases in poorer parts of the world. The buyers? Cash-rich emerging markets and Arab oil states looking to insure themselves against future food shortages. And if you think that's just a reaction to last year's stunning spike in prices, think again. The new trend speaks to the impact global warming will have on where food will be produced in abundance in coming decades.
In terms of global grain production, which is what this investment frenzy is all about, the world is decidedly unflat. In fact, four major regions now provide virtually all the net export volume (that is, the regions export more than they import and/or consume): North America, the former Soviet breadbasket of Russia-Ukraine-Kazakhstan, the "southern cone" of Brazil-Argentina-Chile, and the "down under" duo of Australia-New Zealand.
This quartet exports close to 150 million metric tons of grain each year. But even within this group, the competitive landscape is stunningly tilted, with the unrecognized "OPEC of grain" -- the United States and Canada -- collectively accounting for roughly 70 percent of that annual moveable feast. The last time this region dominated a crucial global commodity to that extent, it was in the mid-19th century with cotton.