Visual Capitalist

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• Visualizing the World’s Biggest Rice Producers
• An Investor’s Guide to AgTech & Food Innovation
• Breaking Down the Cost of an EV Battery Cell
• How do Institutional Investors Choose ETFs?

Visualizing the World’s Biggest Rice Producers Posted: 23 Feb 2022 12:03 PM PST Can I share this graphic? Yes. Visualizations are free to share and post in their original form across the web—even for publishers. Please link back to this page and attribute Visual Capitalist. When do I need a license? Licenses are required for some commercial uses, translations, or layout modifications. You can even whitelabel our visualizations. Explore your options. Interested in this piece? Click here to license this visualization. Visualizing The World's Biggest Rice Producers It's hard to overstate the importance of rice to the world. As a staple food, over half of the global population depends on the crop as a major part of their diet. In fact, rice is considered a vital part of nutrition in much of Asia, Latin America, Africa, and the Caribbean, and is estimated to provide more than one-fifth of the calories consumed worldwide by humans. This graphic highlights the world's 10 biggest rice-producing countries, using 2019 production data from the UN's FAOSTAT and the USDA. Which Countries Produce the Most Rice? With 756 million tonnes produced globally in 2019, rice is the world's third-most produced agricultural crop behind sugarcane and corn (maize), which both have a wide variety of non-consumption uses. Just 10 countries are responsible for a bulk of global rice production: Country Tonnes Rice Produced (2019) % of Total China 211.4M 28.0% India 177.6M 23.5% Indonesia 54.6M 7.2% Bangladesh 54.6M 7.2% Vietnam 43.4M 5.7% Thailand 28.3M 3.7% Myanmar 26.3M 3.5% Philippines 18.8M 2.5% Pakistan 11.1M 1.5% Brazil 10.4M 1.4% Others 119.0M 15.8% Total 755.5M 100.0% At the top of the charts are China (#1) and India (#2), which produced 389 million tonnes combined, accounting for more than half of global production. They're significantly ahead of #3 and #4 countries Indonesia and Bangladesh, which produced around 54.6 million tonnes each. Almost all of the top producers are located in Asia, with the exception of Brazil (#10). Feeding A Growing World With 84% of rice being harvested in just 10 countries, it’s clear that many countries globally must rely on imports to meet domestic demand. In 2019, India, Thailand, Pakistan, and Vietnam were large net exporters of rice, shipping out nearly $16 billion of rice combined. Other countries including Iran, China, Saudi Arabia, and the Philippines consume above production numbers and rely on imports to meet their needs. And not everything makes it from plant to table. In developing countries especially, estimates of 8–26% of rice are lost due to postharvest problems and poor infrastructure. As the global population continues to grow, rice will continue to be a key source of calories around the world—and as our diets change, it’ll be interesting to see how that role shifts in the future. The post Visualizing the World's Biggest Rice Producers appeared first on Visual Capitalist.

An Investor’s Guide to AgTech & Food Innovation Posted: 23 Feb 2022 11:02 AM PST The following content is sponsored by Global X ETFs. An Investor's Guide to AgTech & Food Innovation The global food system is under immense pressure due to three overarching trends: Population Growth This naturally leads to an increasing demand for food. By 2060, the UN expects the global population to reach 10 billion people. Limited Capacity of Existing Agriculture Existing farming methods are very resource intensive and production has already been pushed to the brink. The UN predicts that by 2050, food production will need to increase by 70%. Unsustainable Consumption The world is consuming unsustainable amounts of food, particularly in terms of meat. While livestock accounts for 80% of agricultural land, it supplies just 18% of the global calorie supply. As these trends collide, agriculture technology (AgTech) and food innovation are emerging as two possible solutions. This infographic from Global X ETFs will explain both. The Major Themes of AgTech AgTech is the use of technology to maximize crop yields while conserving water and land. Here is a quick explanation of its segments. Precision Agriculture Precision agriculture is the integration of artificial intelligence (AI) and the internet of things (IoT) into traditional farming practices. These technologies can provide farmers with more data, which in turn can be used to boost efficiency. One example is the John Deere See & Spray machine, which uses various sensors to detect where weeds are. By only spraying weeds, farmers can reduce their herbicide use by up to 77%. Robotics & Automation Robotics & automation aims to reduce the amount of manual labor needed in agriculture. This multi-billion dollar market includes autonomous berry pickers, which demonstrate over 60% more productivity than humans. Drones can also play a role, especially in regions where water is becoming scarce. For example, farmers in California are investing in drones that monitor fields for leaks and other issues. They claim this technology reduces their water inputs by over 40%. Controlled Environment Agriculture (CEA) CEA is the cultivation of plants in an indoor setting. This market is still in its infancy, but the ability to grow food almost anywhere, all year round, could transform the playing field for agriculture. One of the most prominent CEA methods is hydroponics, where plants are cultivated in a nutrient-rich water-based solution instead of soil. Hydroponics could mitigate many of the world's agricultural problems: Issue Hydroponics Benefit Food insecurity A constant stream of nutrients means crops have 7 to 14 more growth cycles over traditional methods. Water scarcity Hydroponics systems make use of recirculated water, meaning plants grow with up to 90% less water. Land degradation Hydroponics systems can be stacked vertically, meaning farmers can grow 3 to 10 times more food in the same amount of space as traditional farms.  Source: Princeton University With pressures mounting on the global food system, innovative disruption will be needed to achieve long-term sustainability. AgTech solutions can certainly boost output, but what can be done on the consumption side? Food Innovation Food innovation refers to plant-based foods and other alternatives such as lab-grown meat. Given the immense scale (and carbon footprint) of the meat and dairy industry, these innovations could reap environmental benefits. In terms of market share, alternative foods still have a long way to go. The following table lists global meat and dairy sales, by category, in 2020. Market Traditional Option Alternative Option Alternative Share of Total Meat $1.4 Trillion $6 Billion 0.43% Dairy $574 Billion $18 Billion  3.14% Source: Global X ETFs Considering that 80% of Americans have either purchased or are open to purchasing alternative meat products in the future, investors may view this sector as an attractive growth opportunity. For further perspective, some analysts believe that by 2040, cultured meat (lab-grown meat) will account for 35% of the global market. Introducing the Global X AgTech & Food Innovation ETF The Global X AgTech & Food Innovation ETF (Ticker: KROP) seeks to provide investment results that correspond generally to the price and yield performance, before fees and expenses, of the Solactive AgTech & Food Innovation Index. Sector Index Weight Consumer Staples 44.8% Materials 37.3% Industrials 11.6% Health Care 4.1% Consumer Discretionary 2.1% As of 01/31/2022 Investors can use this passively managed solution to gain exposure to innovation in the agriculture and food industries. The post An Investor's Guide to AgTech & Food Innovation appeared first on Visual Capitalist.

Breaking Down the Cost of an EV Battery Cell Posted: 22 Feb 2022 10:57 AM PST Subscribe to the Elements free mailing list for more like this Breaking Down the Cost of an EV Battery Cell This was originally posted on Elements. Sign up to the free mailing list to get beautiful visualizations on natural resource megatrends in your email every week. As electric vehicle (EV) battery prices keep dropping, the global supply of EVs and demand for their batteries are ramping up. Since 2010, the average price of a lithium-ion (Li-ion) EV battery pack has fallen from $1,200 per kilowatt-hour (kWh) to just $132/kWh in 2021. Inside each EV battery pack are multiple interconnected modules made up of tens to hundreds of rechargeable Li-ion cells. Collectively, these cells make up roughly 77% of the total cost of an average battery pack, or about $101/kWh. So, what drives the cost of these individual battery cells? The Cost of a Battery Cell According to data from BloombergNEF, the cost of each cell's cathode adds up to more than half of the overall cell cost. EV Battery Cell Component % of Cell Cost Cathode 51% Manufacturing and depreciation 24% Anode 12% Separator 7% Electrolyte 4% Housing and other materials 3% Percentages may not add to 100% due to rounding. Why Are Cathodes so Expensive? The cathode is the positively charged electrode of the battery. When a battery is discharged, both electrons and positively-charged molecules (the eponymous lithium ions) flow from the anode to the cathode, which stores both until the battery is charged again. That means that cathodes effectively determine the performance, range, and thermal safety of a battery, and therefore of an EV itself, making them one of the most important components. They are composed of various metals (in refined forms) depending on cell chemistry, typically including lithium and nickel. Common cathode compositions in modern use include: Lithium iron phosphate (LFP) Lithium nickel manganese cobalt (NMC) Lithium nickel cobalt aluminum oxide (NCA) The battery metals that make up the cathode are in high demand, with automakers like Tesla rushing to secure supplies as EV sales charge ahead. In fact, the commodities in the cathode, along with those in other parts of the cell, account for roughly 40% of the overall cell cost. Other EV Battery Cell Components Components outside of the cathode make up the other 49% of a cell's cost. The manufacturing process, which involves producing the electrodes, assembling the different components, and finishing the cell, makes up 24% of the total cost. The anode is another significant component of the battery, and it makes up 12% of the total cost—around one-fourth of the cathode's share. The anode in a Li-ion cell is typically made of natural or synthetic graphite, which tends to be less expensive than other battery commodities. Although battery costs have been declining since 2010, the recent surge in prices of key battery metals like lithium has cast a shadow of doubt over their future. How will EV battery prices evolve going forward? The post Breaking Down the Cost of an EV Battery Cell appeared first on Visual Capitalist.

How do Institutional Investors Choose ETFs? Posted: 22 Feb 2022 10:41 AM PST The following content is sponsored by iShares Download the ETF Snapshot for free. How do Institutional Investors Choose ETFs? Although there are roughly 7,000 ETFs available globally, the majority of assets under management (AUM) belongs to a relatively small number of funds. In fact, among the 100 largest ETFs, the top 20 hold over 50% of the assets. In this infographic from iShares, we rank the top criteria institutional investors use when selecting an ETF. It’s the last of a five-part series covering key insights from the ETF Snapshot, a comprehensive report on how ETFs are being used. The Methodology To assess how institutional investors navigated this volatility, Institutional Investor published a report in 2021 based on a survey of 766 decision makers. Respondents were from various types of organizations, firm sizes, and regions. For instance, here is how responses broke down by location: 21% Asia Pacific 36% North America 29% Europe, Middle East and Africa 14% Latin America Here's what the survey found. The Top Criteria for Picking an ETF The following table lists the most important criteria institutional investors consider when selecting an ETF. Criteria % of respondents (n=762) AUM, liquidity, and trading volume 68% Benchmark index used 53% ETF provider's brand and market position 48% Historical performance 46% Value-added services from ETF provider 45% Management fee 34% Transaction cost  29% n=762 The key takeaway is that institutional investors seek large, highly liquid ETFs that are linked to the right benchmark. Perhaps surprisingly, management fees and transaction costs were the lowest priorities. Preferred Index Providers by Asset Class To gain further insight, survey respondents were asked to share their most preferred index provider for each asset class. For international equities, MSCI was the top index provider with S&P trailing a close second. The two providers switched places when it came to domestic equities. Index Provider Domestic equities (% of respondents) International equities (% of respondents) MSCI 28% 23% S&P 25% 29% FTSE Russell 22% 23% Morningstar 14% 12% Qontigo/Stoxx 11% 13% n=766 Next, respondents ranked their top choices for factor-based and ESG investments. MSCI and S&P were once again the most popular providers. Index Provider Factor-based strategies (% of respondents) ESG strategies (% of respondents) MSCI 30% 25% S&P 26% 28% FTSE Russell 26% 22% NYSE Factset 10% 13% ICE 7% 8% n=766 Lastly, respondents ranked their top choices for fixed income investments. This included three categories: investment grade fixed income, high yield fixed income, and emerging market debt. Index Provider Investment grade fixed income High yield fixed income Emerging market debt S&P 34% 29% 26% FTSE Russell 23% 24% 25% Bloomberg 18% 23% 22% JPMorgan 17% 15% 17% ICE 5% 4% 6% iBoxx IHS Markit 2% 3% 3% n=766 S&P was the most popular provider across all three categories, with FTSE Russell coming in second. Want more institutional insights into ETFs? Download The ETF Snapshot for free. What Role can ETF Providers Play? 45% of institutional investors (n=762) said they consider an ETF provider's value-added services when selecting an ETF. "We use a number of tools—but we also rely on the provider of ETFs to a great extent. They have a lot of analytics in terms of trading activity, flows, and underlying liquidity of the asset class. Senior Analyst, asset management firm The following table ranks the most helpful value-added services. Service % of respondents Portfolio construction expertise 68% Client service teams 60% Market education and insights 60% Portfolio consulting solutions 56% Portfolio modeling and trading tools 51% n=762 To wrap things up, institutional investors were asked to share their ETF provider of choice. Here were the results. ETF provider % of respondents BlackRock/iShares 24% State Street/SPDR 12% Invesco 9% Vanguard 9% Wisdom Tree 5% ProShares 5% n=762 To recap the findings of this survey, institutional investors give the highest priority to AUM, liquidity, and trading volume. Beyond those criteria, other elements such as value-add services and fees can help to drive a final investment decision. Download the ETF snapshot for free. The post How do Institutional Investors Choose ETFs? appeared first on Visual Capitalist.

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