When World Population Peaks,  How Will Ag Adjust

In the not-so-distant future, the global population will peak. The impacts to food and agricultural demand will be felt sooner as populations trend older. "The Big Shrink”, a new multi-report series from Terrain, examines what these realities mean for the U.S. agricultural industry and what opportunities may arise.

Terrain, a team of ag economists and analysts who provide expert analysis and confident forecasting to the customers of AgCountry Farm Credit Services, American AgCredit, Farm Credit Services of America and Frontier Farm Credit. The team helps farmers and ranchers anticipate what may lie ahead, whether that's three months or 30 years from now.

"Populations have already peaked in many of the U.S.'s major trade-partner countries," explains John Newton, Ph.D. executive head of Terrain. "What will drive success for farmers and ranchers in just a few decades will likely look very different than what has worked for the last 30 years. Historically, success was defined by growing on-farm yield and productivity, knowing that the agricultural supply chain could export the 'extra' production to feed the world. While the need for on-farm efficiency won't go away, the revenue streams and value drivers will likely change as populations around the world reach their peak. U.S. farmers and ranchers are the best in the world, and they can rise to this occasion."

In Terrain's projections, the global population will peak between 2065 and 2070 at 9.38 billion people. These figures are sooner and lower than the U.N.'s current "most likely scenario" projections -- 2084 at 10.3 billion people -- after its last set of downward revisions due to global fertility rates and population estimates. As explained in report No. 1 of "The Big Shrink," "How Will Agriculture Navigate the Baby Bust?" the driving factor for Terrain's projections is rapidly falling fertility rates around the world.

Report No. 2, "Best Trade Friends Forever?", analyzes the risk associated with the export portfolios for corn, sorghum, soybeans and wheat. This report outlines why investments to diversify and modernize exports over the next decade will be important for success in American agriculture.

Read the first two reports of "The Big Shrink" at TheBigShrink.terrainag.com. More reports will be added throughout 2025 to help the industry consider how a peaking population may impact demand for products, such as tree nuts, animal protein and dairy; how agricultural policy may evolve to help farmers navigate these new challenges and opportunities; and more.

EDITOR’S TAKE:

These reports shine a bright light on a topic that not many people focus on or may even realize is taking place. We previously reported in this newsletter about China and their struggles with lower birth rates and loss of population. But now the issue is much broader in scope – worldwide. The big question is how do we adapt to these changing realities. As the article aptly points out, U.S. agriculture has for decades produced more and more thanks to technological advances and innovative applications that have led to much greater efficiency. What is not used domestically is then exported to nations around the globe. The fact that demand is projected to shrink, calls for production to also shrink. That portends very new ways of thinking about what is needed to support that lower demand and production. Fewer or different scale farms? What about processing and distribution capacity? Will retail or restaurants also adapt? And what about the equipment, fertilizer, crop protection and seed industries? The list of questions applies to virtually every aspect of society. I would love to be around to see how all of these questions are answered, but that is not likely. However, it may not be too soon to begin searching for answers today.

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