Potash Corp./Saskatchewan (USA) (POT), Mosaic Co (MOS), Monsanto Company (MON): Think Food Prices Are High? You Have No Idea

Those days of heavy growth, however, are subsiding. Not only has fertilizer usage reached a saturation point, but a breakup of key global alliances has sent commodity (and stock) prices tumbling in the sector.

The technology now front and center for making cheap food is genetic engineering. In 1994, the United States approved its first genetically modified organism (GMO) for human consumption: the Flavr Savr tomato made by now-Monsanto Company (NYSE:MON) subsidiary Calgene.

Though the tomato wasn’t a huge success, it ushered in a new era of agribusiness. With the ability to engineer and patent seeds, scientists at Monsanto, The Dow Chemical Company (NYSE:DOW), and E I Du Pont De Nemours And Co (NYSE:DD) — three of the largest companies producing GMOs worldwide — can create plants resistant to herbicides that would normally kill a plant. In theory, that means that the days of plagues and pestilence are over, and food production can take off once again.

On the global scale, no country uses more land to produce GMO crops than the United States.

Source: ISAAA, Mother Jones.

To put that in perspective, before the 1990s, no land in the U.S. was used for GMOs. By 2012, more than 270,000 square miles were devoted to the new method of growing crops.

Whether or not this boom in food production is a good thing is a topic for a different article, but suffice it to say that if you hear someone complaining about the cost of food, gently remind them that it’s cheaper now than it’s ever been.

The article Think Food Prices Are High? You Have No Idea originally appeared on Fool.com and is written by Brian Stoffel.

Fool contributor Brian Stoffel has no position in any stocks mentioned, and neither does The Motley Fool. 

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