Two Ways to Invest in Ending World Hunger

Robert Hsu, October 16, 2009

Today marks World Food Day, which is a time to call attention to the many suffering throughout the world because of a lack of food. In fact, the worldwide malnourished total surpassed a record one billion this year due to an increase of 105 million hungry people.

That means that almost one sixth of the world's population is suffering from hunger. That's a massive number -- and as the world's most populous country, China is in the limelight when facing this problem. But the Chinese government understands the problems facing its farmers and food industry and as a result, China is giving top priority to food security.

In fact, in the past 10 years China has reduced the number of people who go hungry in the country by 58 million. Just 30 years ago, China was dependent on world aid to feed some 400 million of its citizens -- but in 2006, China turned from dependent to donor, since providing food aid to dozens of developing countries.

It's clear that although grain output in China has increased for many years, Chinese policymakers aren't blind to the long-term prospects of food supply as the country's overall agriculture infrastructure remains poor and the country suffers from frequent droughts and dry weather.

There's no denying that Chinese farmers have their hands full in trying to keep up with China's growing population while losing acreage yearly. And though China is expected to have a moderate harvest this year -- despite an unexpected and severe drought that we've discussed before -- the government isn't sweeping the problem under the rug.

Instead, the Chinese government is working at increasing rural incomes and subsidizing their farm purchases such as seed, fertilizer, diesel and other agriculture-related materials. China is also increasing its investment in rural healthcare, cutting farm taxes and boosting rural incomes by allowing farmers to sell their land-use rights. The government is also focusing on farmers using better, more effective organic fertilizer.

Over the years the majority of the fertilizers used and produced in China were chemical based, which wreak havoc on farmland. But now, China's National Development and Reform Commission recently announced that it would eliminate chemical-based fertilizers in the next five years. Instead, most Chinese farmers will be using organic fertilizers.

All this emphasizes why we're investing in two organic fertilizer opportunities…

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