This was one of the scenarios put during a session on key drivers in the global meat business at the Australian Meat Industry Council's annual exporter conference yesterday.

Former academic, Professor John Chudleigh, who provides a consultancy on world trends and prospects for Australia's agricultural commodities, told the meeting that global grain supply and prices would probably drive the future of the world’s total agricultural sector over the next five to ten years.

"In seven of the last nine years, global production of cereal grains has failed to meet consumption," Prof Chudleigh said.

"As a result, world stocks of cereals grains have fallen to the extent that panic buying started to emerge last year."

Global production of coarse grains, wheat and rice had each hit record yield and area levels this year, yet the world had still only produced a fraction more than what was consumed.

"Consequently, we are currently facing a need to produce absolute record crops year after year, which history would show is an impossibility," he said.

"Some time in the next ten years, I expect the world will face an absolute grain crisis.

"We’re on a knife edge that we have never seen before."

When this last occurred in the 1970s, the price of wheat almost tripled in order to generate the additional production required to correct the imbalance.

Prof Chudleigh said that would have to happen again if the situation was to be reversed, and that had "all sorts of implications" for the Australian beef and feed industries.

"In the last few years, because of increased protein demand and ethanol, the world now requires an extra 30 million tonnes of cereal grains each year, just to keep pace with demand," he said.

"That is going to continue for at least the next five years, unless there is a major setback in grain use or meat consumption."

Extract from a full report to appear in selected Fairfax weekly rural newspapers, September 11 editions. Further issues emerging from the AMIC conference will be covered in detail in a National Beef Review, published in the rural weeklies on September 25.