Investing Investing In The Future Of Food (Part 3 - When "Chickens" Fly)

<< Read Part 1: Investing In The Future Of Our Food

<< Read Part 2: Investing In The Future Of Food (Chew On This)

(Fun Fact: the longest recorded flight of a chicken lasted only 13 seconds. Hardly a “flight” if you ask me.)

Despite being prohibited by some major world religions, pork has been the most commonly consumed protein on earth. However, a cheaper and more readily available protein is quickly surpassing all protein sales—chicken.

Currently, there are approximately 3 chickens for every 1 person on earth and with the expected increasing of urbanization in the future, cheap protein will be increasingly necessary. Compared to today, 690 million additionally tons of livestock feed will be needed each year, and all evidence points to chickens being the safer and cheaper bet. To produce 1 kilogram of chicken meat it takes

2 kilograms of feed; by comparison 1 kilogram of pork takes 4 kilograms of feed and 1 kilogram of beef takes 7 kilograms of feed.

Also note that meats are a far more easy commodity to price out since the “growing season” is year-round in any climate as long as the feed remains manageable. Ultimately, the prices of commodities are determined by future levels of supply and demand. As we’ve seen from China, demand for protein will exponentially increase in the next 40 years; while supply among farms is dwindling and meat production will have to double to meet this demand.

Tyson Foods (TSN) is the largest meat producer in the United States, and is very much aware of this approaching spike in demand, but pulling-in international revenues is still only just beginning. Take for example, the following charts from TSN investors’ information: international sales currently make up about 16% of its overall revenues. In a world with 2 billion more mouths to feed, and an ever increasing demand for affordable and commonly found protein, clearly the future is promising for the likes of American meat manufacturers.

Stay tuned for more details on the agricultural business in America in the future, and keep posted on details regarding Green Investing in the coming articles.

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