In a new report, Asia Research Engagement (ARE) examines the impact of growing affluence in Asia in terms of our need for protein and, more specifically, the environmental consequences of that protein journey.
Commissioned by ADM Capital Foundation and ADM Capital’s Cibus Fund, the report reflects what I have observed over two decades investing in the region and watching the rapid development.
The Cibus Fund strategy was, to a great extent, developed on the premise that domestic production of animal protein, especially in Asia, is increasingly challenged by reduced availability of natural resources, particularly land and water.
An interesting landscape has developed as countries without adequate resources at home to feed their populations have turned their attention to domestic food security, in particular China.
This focus has manifested itself in cross-border purchases of agribusiness companies in countries with sufficient resources and the ability to produce foods for export. An example of this is Shanghai CRED’s third-time-lucky bid in 2016 for the massive Australian integrated beef concern, Kidman property, which boasts 185,000 head of cattle.
This global strategy to achieve food security acknowledges the significant increase in protein consumption with population growth and affluence, as well as what the associated negative externalities addressed in the report.
The reality is that whilst we see many food companies that may disrupt this sector and bring improvements in emissions, diets are changing and, without action by governments to protect against excessive and polluting resource use, our ecosystems and climate will suffer.
We believe Charting Asia’s Protein Journey will help build understanding of the changing global trade flows as well as the challenges we face in feeding our future.