1. M EGATRENDS IN A GRICULTURE Road Warrior of Agriculture: www.cornandsoybeandigest.com Dr. David M. Kohl Professor Emeritus, Agricultural and Applied Economics Virginia Tech, Blacksburg, VA (540) 961-2094 (Alicia Morris) | (540) 719-0752 (Angela Meadows) | sullylab@vt.edu January 19, 2013

2. The Wild World of Global Economics  Swiss cheese economy  China 7 th in 2000, 2 nd in 2012 & Brazil is 14 th in 2000 and 6 th in 2012  China vs. USA 2047- 2032 - 2019  USA household income:  $54,000 in 2000, $47,500 in 2012  China household income:  $1,090 in 2000, $6,500 in 2012  800 million people in China live on less than $2.00 per day  27% of the world population live on less than $1.00 per day  20% of the world population live on less than $2.00 per day  Commodity boom- super cycle  50% of the world economic growth since 2000 has been BRICS & KIM-T 2

3. The State of Global Economies: Percent of World GDP Developed/Rich NationsEmerging/Growing Nations USA 23.6%China 9.3% Euro Sector 26.0%Brazil/Russia /India/S. Africa 8.6% Japan 8.3%Total BRICS 17.9% Summation of Developed 57.9% South Korea 1.6% Indonesia 1.1% Mexico 1.6% Turkey 1.2% Total KIM-T 5.5% Summation of Emerging 23.4% 3

4. Supersized Supercycle  half of world growth in emerging nations  BRICS & KIM-T’s = U.S. economy (as a % of world GDP)  ethanol & biofuels  oil, gas, & minerals  low value of dollar  low interest rates  minimal opportunity for investments  320/260/60 rule  mother nature/production concentration 4

5. Global Factors & Indicators  8-5-3 rule of emerging nations  Euro debt 87% GDP  German elections  China  economic slowdown  population shifts  trade  PMI < 50  synchronized slowdown 5

6. USA Economy Indicators  fiscal cliff/slope/downgrade debt  debt level: 105% GDP & 41% foreign financed  PMI: 50 rule  LEI: 0.3% rule  Housing starts: 1.1 million  Unemployment rate: 5.0%  Core inflation: 2.0% & Headline inflation: 4.0% 6

7. Global Economic GDP Growth AssessmentLocationCurrentGreenYellowRed USA Europe Japan BRICS Nations* KIM-T Nations** *Brazil, Russia, India, China, and South Africa Fill in current status and check green, yellow or red for each region. © 2010 by Dr. David Kohl & Dr. Ed Seifried 7 ** South Korea, Indonesia, Mexico, and Turkey

8. Cut Above Super Producer  profit plan: 60-30-10  growth/evolution plan  working capital & liquidity plan: 33% rule  modest/conservative debt: 50% rule  margin= earns & turns  modest living  sixth “C” 8

9. 10 Reasons to be Optimistic About Agriculture 1.50/100/70 Rule 2.Agriculture is 5-dimensional 3.One size does not fit all 4.Young people, women, and minorities 5.Convergence of technology 6.1 in 6 jobs 7.BRICS & KIMT 8.Think globally & act locally 9.Profitable 10.The cooperative system support network 9