Cattle Network
June 9, 2009

LONDON, June 9, 2009 – U.S. Grains Council President and CEO Ken Hobbie addressed more than 500 attendees today at the 2009 International Grains Council Grains Conference in London. Markets remain volatile after the sharp falls in grain prices seen in the second half of 2008, accompanied by increasing global financial and economic turmoil. A key question is the extent to which the economic slowdown will affect world grain consumption and trade patterns, including in the food, feed, biofuel and other industrial sectors. Hobbie told participants that despite uncertainty, people have to eat and the global population is growing rapidly. In 2000, the global population topped the 6 billion mark and is anticipated to surpass 10 billion in 2050. Almost all future population growth will be in developing countries.

“We are told world food production will need to double by the year 2030 in order to feed our growing population. None of that potential demand has been derailed by the economic slowdown of 2008 and 2009. While it is fair to say, we don’t know exactly how the current crisis will play out, we have seen that food demand is resilient,” said Hobbie. “When the cycle of economic growth returns, food demand will be strong, and agricultural trade will be vital in meeting that demand. U.S. agricultural producers are committed to the global marketplace.”

The productive capacity of U.S. agriculture ensures a growing supply of coarse grains that will satisfy demand for domestic feed use, ethanol production and exports.

“The food and fuel debate is settled. The most rapid growth of the U.S. corn-based ethanol industry is past, while the most rapid growth of U.S. corn yields is in front of us,” said Hobbie. “New production technologies offer great promise for increasing productivity to meet the growing demands of world consumers. Biotechnology, perhaps, shows the greatest promise to enhance crop production in the United States, in the poorest developing country and in every country in between.”

The future of all agricultural trade, according to Hobbie, depends on developing laws, policies and agreements that allow the forces of the marketplace to work. Particularly, he enforced the need to complete the Doha Round of the World Trade Organization in order to eliminate or reduce export subsidies and market access barriers that hinder free and open trade. He also urged the passing of other bilateral and multilateral free trade agreements that open markets and stimulate trade. Sound science was encouraged when imposing biotechnology, sanitary and phyto-sanitary regulations.

“The marketplace works. U.S. and world agriculture are resilient in responding to shocks and changes. But trade restricting and trade distorting policies are the greatest obstacles to obtaining the full benefits of the marketplace and satisfying the growing food demand of consumers around the world. Even in the hard times, barriers to trade may be the more serious threats to consumers than price or reduced incomes,” Hobbie said. “In the marketplace we must recognize that even competitors must be partners. Only together can we ensure the rules of the game are right. Only together can we extend to the people in each country the benefits of free and open trade.”