Mr. Bryan Dierlam - Policy That Will Meet the Needs of the Growing Food Supply

National Institute for Animal Agriculture 2013

© Copyright Cargill, Incorporated 2012. All rights reserved.



Policies to Meet the Food Needs of a Growing World

Bryan DierlamCargill, Director, Government Affairs

April 17, 2013Louisville, Kentucky

April 10, 2023



Key Trends

Volatility

Trade

Protein Consumption

Population Growth

Income Growth

Biofuels

Health & Nutrition

Sustainability

2



GLOBAL FOOD PRODUCTION VS. PRICE(production of grain, rice, major oilseeds, PO, FSHM vs. corn/soybean/wheat futures price index)

-30

-20

-10

0

10

20

30

40

50

60

70

1975

1980

1985

1990

1995

2000

2005

2010

April 10, 2023

Percentage change in production

Percentage change in price

Source: USDA



world food flows(grains, rice, oilseeds, meals, oils, feed equivalent of meat – net interregional in mmt)

N Amer S Amer Australia E Eur/FSU C Amer W Euro Asia MidEaAfr-200

-150

-100

-50

0

50

100

150

200

1965 1970 1975 1980 1985 1990 1995 2000 2005 2010

exporters: more land than people

importers: more people than land



April 10, 2023

More people, more income, bigger appetites

0

500

1000

1500

2000

2500

3000

0 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30

0

20

40

60

80

100

120

140

160

000 USD income per capita – 1997$

mil population (grey bars) kg / cap / year (lines)

grain

meat

sugar/sweeteners

vegoil



The Effects of Higher Disposable IncomeExample - Chinese Meat Consumption grew 6-fold in 30 years

Meat consumption – 1981(Pork, Broiler, Beef)

China11%

USA22%

Rest of the World

67%

Meat consumption – 2011(Pork, Broiler, beef)

China29%

USA14%

Rest of the World57%

April 10, 2023

108 Mln Tons

237 Mln Tons

Source: USDA



April 10, 2023

Biofuels Volumes – a Major Shift

• Grain to ethanol

0

20

40

60

80

100

120

140

160

180

2001 2006 2011

Million Metric Tons

• Vegoil to biodiesel

0

4

8

12

16

20

24

28

2001 2006 2011

Million Metric Tons

~9% of world grain market

~14% of world vegoil market



Populations are expanding where it is most difficult to grow food

8



Sustainability

9



Cargill Supply Chains

10



11



12

Cargill Suppy Chains



Cargill Supply Chains

13



Policy Opportunities and Challenges

Honor Comparative Advantage

Enable Open Markets

Invest in Infrastructure

Agricultural Productivity

Harmonization of Standards

Support Smallholder Farm/Property Rights

14



COMPARATIVE ADVANTAGE

DAVID RICARDO

The world will always raise the most food the most economically if every

farmer plants the right crop for the soil and climate, and then trades with

others.



16

Comparative Advantage &

Trade

Policy Opportunities in GREENPolicy Challenges in RED



17

Open Markets, Price Discovery,

Risk Management

Disrupted Market Signals

Political, Fiscal & Monetary Risk Factors

Regulatory Barriers



18

Transportation Goods to

Market



April 10, 2023

Genetic improvements and fertilizer intensification drive supply expansion thru yield -- acreage has not been a significant supply drive until recently

19751978

19811984

19871990

19931996

19992002

20052008

201190

100110120130140150160170180190200210

Production

Yield

Area

Key driver of production growth: yield increase

Index (1975=100)

Source: USDA



20

Biotechnology &

Innovation



Export Disaster - Don’t Do This!

Plants (LT30) (LT30) (Bovine EV) (LT30) (LT30) Open 7/10/08 (Bovine EV) (Bovine EV) (LT30) (LT30)

Approved U.A.E. Chile Colombia Dominican El Salvador Hong Kong Japan Korea Lebanon Mexico Panama Peru Russia Singapore St. Lucia Taiwan Thailand Ukraine Vietnam

As of 8/18/06 As of 4/30/10 10/1/2008

Dodge City, 86K, Millard Dodge N Y Y Y Y Y Y Y Y Y Y Y Y N Y Y Y Y Y

10/1/2008 Relisted 11/17/08 Friona, 86E N Y Y Y Y N Y Y Y Y Y Y Y Y Y Y N Y Y

As of 4/8/08 Relisted 7/12/07

Ft. Morgan, 86R N Y N Y Y N Y Y Y Y N N Y N Y Y N Y Y

As of 9/07

Plainview, 86H N Y Y Y Y N Y Y Y Y Y Y N N Y Y N Y Y

Relisted 11/25/08

Schuyler, 86M N Y Y Y Y N Y Y Y Y Y Y Y N Y Y Y Y Y

Fresno, 354

Wyalusing, 9400

As of 7/12/07

Allow Canadian YES NO-direct slau YES YES YES YES-AV YES YES YES YES NO-direct slau NO-direct slau NO YES YES YES YES YES

Cattle? NO-A40 100 Days in U.S. 100 days for bone-in

Age Requirement <30 None <30 <30 <30 <21 <30 <30 <30 None None <30 <30 <30 <30 <30 <30 <30

General Product Boneless >30, boneless Beef prods Boneless Boneless Boneless, Boneless Boneless Boneless, >30, boneless >30, boneless Boneless & Boneless Boneless Boneless, Boneless Boneless, Boneless,

Requirements Beef Only FTB OK Offals Beef Only Beef Only Bone-in & Bone-in & Bone-in Bone-in & FTB OK FTB OK Bone-in Beef Only Beef Only Bone-in as Beef Only Bone-in Bone-in

Tongues (no Offals Offals (no of 11/2/09, Offals

<30, boneless Hanging headmeat) No >30s intestines,) <30, boneless <30, boneless No GB must be <30

& bone-in Tender is OK for the QSA No AMR & bone-in & bone-in CDN 100 days

U.S. Trim OK per the QSA

No Diaphram

Special Halal Tallow is not No AMR No Offals, No Mex 7/10/2008 Prod must be Boneless We are not We are not Cannot No Mex No Offals Effecitve No AMR No AMR

Considerations Slaughter part of the EV No AMR Cattle for Slau Date rec'd w/in 180 Beef from listed for >30s listed for >30s produce until cattle for 4/1/10 No Offals

Only Maintain direct Slau of slaughter Canada is on-site audit direct slau certain offals after 7/15/10

CMS not traceback of Mex cattle Must be on eligible OK to ship kill date

listed for >30s cattle to prod Begin w/ do not need vessel w/in 30 (No Cdn No Imported

No Trim 7/27/06 Slau 100 days in US days of cert trim) Beef Mex 100 days

Allow GB? N Y Y Y N N N Y N Y Y N N Y N N Y Y

Require SOV? Y Y N Y Y Y N Y N Y Y Y Y Y Y Y Y Y

Specific Offals None Aorta None None None, incl Tongue-all Abomasum None Cheekmeat Aorta Heart None None Tendon None Aorta None

(Eligible) Backstrap Diaphram & Abomasum Heart Backstrap Liver Tongue Backstrap as of 9/14/10

Cheekmeat Outside Skirt 86R Only Kidney Cheekmeat Tongue Cheekmeat

Heart Livers, Liver Heart Heart

Kidney Tendons Omasum Kidney Kidney

Liver 86K, M, R Oxlips Liver Liver

Omasum Only Tongue Omasum Omasum

Oxlips Offals Tripe Oxlips Oxlips

Tendon be written in Trimmings Tendon Tendon

Tongue the EV and Tongue Tongue

Tripe approved by Tripe Tripe

AMS



Export vs. Domestic Market$60+ advantage/head on 7 products

ProductValue in Export

Market $ Value/# Lb/Hd $/HD/Export

Value in DomesticMarket $ Value #/hd $/HD/US

Short Ribs Korea $3.00 10 $30.00 US/Canada $ 0.80 10 $ 8.00

Navels Japan $1.60 20 $32.00 US/Canada $ 0.80 20 $ 16.00

Finger Meat Korea $2.50 1 $2.50 US/Canada $ 0.80 1 $ 0.80

Digital Muscle Taiwan $2.25 1 $2.25 US/Canada $ 1.50 1 $ 1.50

Liver Russia/Egypt $0.60 13 $7.80 US/Canada $ 0.12 13 $ 1.56

Oxliips Mexico $1.40 1.5 $2.10 US/Canada $ 0.15 1.5 $ 0.23

Tongue Japan $5.00 3 $15.00 US/Canada $ 0.10 3 $ 0.30

$91.65 $ 28.39



23

Harmonization



Property Rights

24



The Values Question

• Values vs. Technology• Tin vs. Food• Managing the Dichotomy• Anonymity vs. “Story Food”• Knowing Your Farmer and Agricultural Values• Improve our Messaging—Who do we talk to?

25



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Mr. Bryan Dierlam - Policy That Will Meet the Needs of the Growing Food Supply

Education