Sustainable Agriculture Investment Poised to Surge
September 14th, 2009 By Janine Yorio
Earlier this year, investment guru Jim Rogers predicted that within the next decade farmers will be the ones driving Lamborghinis, while stock brokers will drive tractors or taxis. His contrarian proclamation has since fueled intense investor interest in the agriculture sector. But despite this growing interest, the majority of investors have yet to discover the sector’s most promising niche: sustainable agriculture.
Today, farming uses 80 to 90% of all the water consumed in this country, along with millions of gallons of chemical pesticides, hormones and antibiotics. After food is grown, processors and retailers ship it across vast distances before it reaches consumers. The result is a tangled web of farms, runoff, oil dependency and highly-processed or unripe food laced with chemicals. Sustainable agriculture offers a healthier, more environmentally-friendly alternative.
Two measurable factors are driving growth in the sustainable agriculture sector: rising oil prices and increasing consumer demand. Traditional agriculture is highly dependent upon petrochemicals. In fact, in 2006, when fuel and fertilizer prices began to rise, USDA researchers noted that most farmers immediately began to reduce fertilizer, fuel, pesticide and herbicide usage to reduce costs. With input costs on the rise, “sustainable” practices may become synonymous with “cost-effective.” Read More