The world’s biggest problems are the world’s biggest business opportunities.- Peter Diamandis
Peter Diamandis and his Singularity University have a unique look on the World. He believes that the bigger the problem the bigger the business opportunity for the person who can create a scalable solution.
What scale solution?
Diamandis and S.U. are only focussing on problems that affect more than a billion people worldwide. If you can solve a problem that affects a billion people and you can bring that solution to at least a billion people inside of ten years, you’d have a company that would excite Diamandis and his team at Singularity University.
That’s the framework and lens we’ll be using to assess Food-Security and whether it meets the standards that would make it one of the biggest investment opportunities of this century.
The first qualification that we have to meet lies in understanding how many people feel food insecure. If enough people are food insecure, and we can find solutions that would help at least a billion of them, then we have a potentially exciting opportunity. The second will be can we bring these solutions to light within the next ten years? If we can say yes to both, then we can conclude that investments in Food-Security have the potential to be some of the biggest investment opportunities of this century.
So what does Food (In)Security look like world wide?
The United Nations Food and Agriculture Organization estimates that about 795 million people of the 7.3 billion people in the world, or one in nine, were suffering from chronic undernourishment in 2014-2016. Almost all the hungry people, 780 million, live in developing countries, representing 12.9 percent, or one in eight, of the population of developing countries. Right off the bat, just looking at hunger alone we almost hit our billion person mark.
In addition to the approximately 800 million currently experiencing food insecurity at an extreme level, there are millions and millions more around the world that may currently not qualify as being undernourished but still see Food-Insecurity on a daily basis.
The FAO defines four dimensions of food security, all of which must be fulfilled simultaneously, for food security to exist. The four dimensions are: 1) physical availability of food, 2) economic and physical access to food, 3) food utilization, and 4) the stability of those other dimensions over time.
The first dimension, physical availability of food, is one that upon a little bit of investigation, we’ll see there is the potential for a lot more people to be affected by this in the coming years. One of the biggest concerns with future food security is that a lot of places that are currently food secure will find themselves very insecure in the coming decades if no action is taken. A big cause of this is access and availability of both fresh water and fertile soil.
Let’s first take a look at the water situation. Although more than 70% of the world is covered in water, only 2.5% of that water is actually fresh water we can use to grow food. Of that 2.5%, nearly 70% of that is trapped in Greenland and Antartica as frozen ice. And when it melts thanks to rising temperatures caused by global warming it melts into the salt water ocean meaning it is essentially useless. These melts also lead to rising Oceans which will affect more sources of water like groundwater sources currently at or near sea level.
So what water is usable?
It turns out that less than 1% of the earth’s water is actually available for human use. And humans are using that water at ever increasing rates. In February 2009, U.N. Deputy Secretary General Asha-Rose Migiro warned that two-thirds of the world’s population will face a lack of water in less than 20 years if current climate trends continue. She also noted that agriculture consumes roughly 75% of the world’s fresh water (Bernstein, 2011). This means that as quickly as 2029 50% of the water currently used for agricultural use could be threatened. That is going to affect a lot of crop growth and is going to lead to a lot more people than almost 800 million already feeling food insecure.
But that’s not the only threat we see between water and food production.
Freshwater is made available to us in three distinct ways: as rainwater, surface water (lakes, streams rivers, etc) and near-surface groundwater aquifers. All three of these sources are currently being threatened by climate change, over utilization and pollution. Ultimately everything ends up flowing into the groundwater reserves and aquifers which have been colloquially dubbed our fresh water savings accounts. If the water isn’t replenished at or above the rate it is used then those reserves are depleted completely.
One-third of the world is completely dependent on groundwater. As the population increases our need for water will increase as well. Not only is it more humans who need to drink it’s more humans who need water to be fed to the food they will eat. We’ll continue to draw our water sources down until these water savings accounts reach zero! What’s worse is that we don’t even need to draw them down to zero before they become completely unusable on most cases. If an aquifer is close to an ocean, lowering the water level can destabilize the barriers between the aquifer and the salt water. If this results in seepage of ocean water into the aquifer, that aquifer becomes unusable (Bernstein, 2011)
What’s worse is that the rising ocean levels and dropping aquifer levels aren’t our biggest threat. The biggest threat comes from the same thing we use the majority of our fresh water for; agriculture. In the 2000 National Water Quality Inventory, states reported that agricultural nonpoint source (NPS) pollution is the leading source of water quality impacts on surveyed rivers and lakes, and the second leading source of impairments to wetlands, and a major contributor to impairment of our groundwater resources.
Many of the commercial fertilizers, pesticides, herbicides and other agricultural sprays and products are contaminating our groundwater we desperately need to grow the foods we are using these contaminants on. This is just one of the many areas of agriculture that ripe innovation is needed for us to find food-security in the next decade.
This is part one in our ongoing thought series Why Food Security May Be the Best Investment Opportunity of the Century. We’ll continue next week examining other resources that go into producing food besides water, and assess how secure and sustainable they are in our current food production model. After looking at the inputs to traditional industrialized agriculture we’ll have a better sense of just how many people are truly affected if our current situation was left unchanged.