pure michigan, agricultural update james e. byrum · 2015. 12. 15. · james e. byrum mifood2015...

PURE MICHIGAN,

AGRICULTURAL UPDATE

James E. Byrum

MiFOOD2015

Food Processing

& Agribusiness SummitDeVos Place, Grand Rapids, MI

May 7th, 2015

Agricultural Update

� 2014

� 2015

� Issues and Opportunities

� Future

Copyright Michigan Agri-Business Association

2014

� Cool summer

� Late spring

• Sugar beet planting 45 days later than in 2013oRecord Yields!

• Poor corn maturity

• Good to great fruit crop


1970 vs. 2014

Corn Acres Yield Production1970 1,730,000 81 140,130,000

2014 2,190,000 167 365,730,000

Soybeans1970 515,000 26 13,390,000

2014 2,190,000 46 100,740,000

Wheat1970 495,000 39 19,305,000

2014 485,000 74 35,890,000

Totals1970 2,740,000 172,825,000

2014 4,865,000 502,360,000


2014

� Yield

� Production

� Prices

� Feed Costs

• Great for dairy, pork and poultry


2015

� Spring a bit late• Coolest April on record for many parts of Michigan

• Minimal fruit damage from the recent cool weather

� Planting progressing rapidly� But dry� Warming up pretty nicely at this

point…need rain


Issues and Opportunities

� Global Demand

� Consumer Perception

� Customer Demands

� Climate Change

� Sustainability

� Resources


Population

Source:United Nations

1950 2.5 Billion

2011 7.0 Billion

2050 9.2 Billion

WORLD POPULATION


Middle Class

� 2020

• 350 million more middle class households worldwide

• 49% of developing nations’ population


Feeding the world?

Charlie Arnot, CEO of Center for Food

Integrity, says:

“The ‘feeding the world’ message won’t generate public support for today’s agriculture technology. In fact the latest research from the CFI shows that only 25% of consumers believe the U.S. has a responsibility to provide food for the rest of the world. What consumers care about most is having access to healthy, affordable food.”


Consumer Perception

Are Facebook and Twitter reality, and does science matter?


Consumer Perception

� Vaccinations

� GMOs

� Pesticides

� Fertilizer\Animal Care practices

� Sustainable Production and Practices

� Butterflies and Bees!


Customer Demand

� April 27, 2015 - Chipotle- GMOs (2015)

� January 3, 2014 - General Mills-Cheerios-GMOs (End of 2015)

� February 24, 2015 – Hershey- Milk Chocolate and Kisses-GMOs (2015)

� April 2012 - Burger King-cage free produced eggs (2017)

� April 2012 – Burger King-pork produced free of gestation stalls (2017)

� December 2014 – Starbucks-cage free produced eggs (2017)


Customer Demand

� December 2014 – Starbucks-pork produced free of gestation stalls (2017)

� March 12, 2015 – Aramark-cage free produced eggs (2020)

� December 2014 – Starbucks-abandon artificial growth hormones and fast-growth practices for poultry, as well as

other animal-raising techniques considered by some consumers to be inhumane, such as dehorning, tail docking and castration

� April 2015 – Tyson- working to eliminate human antibiotics from its chickens over the next two years


Climate Change

� Longer Growing Season

� Frequency and Severity of Extreme weather Events

� Micro Weather Bursts


Climate Change

� Water

• California Drought

• Lake Michigan Up 36 inches since January 2013

o 21 inches in the past 18 months

o 790 billion gallons of water per inch!

o Iced Over, more rain and less evaporation

� Water quality

• Runoff

• Heat


Opportunities

� Specialty Production and Processing

• These aren’t small supply issues

o If a McDonald’s makes a move, it is a tsunami

o Tyson antibiotic decision affects 1 of every 5 broiler chickens in the U.S.

o Tyson and Smithfield Pork Practices

o Aramark


Opportunities

� The challenge is supply for a changing demand

� Herbruck’s buys 160% of the organic corn produced in Michigan

� One major canner cannot launch an organic line of canned beans


Opportunities

� Non-GMO

• More acres of non-GMO and organic soybeans grown in Michigan annually than dry beans (+/- 250,000 acres)

� Zeeland

� Export Opportunities


Opportunities

� Trends

• Dairy numberso Too much production for processing capacity

� “Finish” More Pork in Michigan

• Coldwater Processing Plant

� Additional Soybean Processing Capacity

• Hogs eat soybean meal

� Another Ethanol Plant?

• Dairy cattle like DDGs

• Rail rates from Michigan are increasing, and therefore the basis


Opportunities

� Sustainability

• Environmental Benefits

o Reduce Greenhouse Gas Emissions

� Social Value

• Customer Acceptance

� Economic

• Most Sustainable Practices Save Money!


Opportunities

� Sustainability

• Cost of Operation Reduced

• Corporate Goals

o Optics

o Access to Capital

� Challenges

• What is Sustainable

• How to Measure Results

• How to Communicate Results


Resources

� Water!

� Growing Season

� Diversity of Cropping Systems

� Entrepreneurial Growers and Processors


2025

Corn Acres Yield Production

1970 1,730,000 81 140,130,000

2025 2,662,000 250 666,500,000

Soybeans

1970 515,000 26 13,390,000

2025 2,282,500 65 148,362,500

Wheat

1970 495,000 39 19,305,000

2025 555,500 110 61,105,000

Total Bushels

1970 2,740,000 172,825,000

2025 5,500,000 874,967,500


Future

� Limiting Factors

• People

• Infrastructure

o Transportation

o Utilities

o Broadband

� Willingness to Accept

Change and New


FUTURE – GROW FOR THE MARKET


Thank You!

James Byrum

Michigan Agri-Business Association

www.miagbiz.org

“STRIVE TO BE WHERE THE PUCK IS GOING TO BE,

NOT WHERE IT HAS BEEN!”Wayne Gretzky

pure michigan, agricultural update james e. byrum · 2015. 12. 15. · james e. byrum mifood2015...

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