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Resource Availability

Concerns that humanity may run out of natural resources date at least as far back at Thomas Malthus 1, who at the dawn of the Industrial Revolution argued that food supply should grow arithmetically, population should grow geometrically, and thus any country will eventually be pushed to subsistence. More recently, Paul Ehrlich argued in 1968 that there would be near-term, unavoidable famines due to overpopulation 2. Starting in 1972, the Club of Rome has echoed the similar concern that a growing world population will lead to the exhaustion of food and other resources 3.

Such concerns have not generally materialized. By contrast, Julian Simon argued in 1980 that, given a credible threat of resource shortage, the price signal would bring about new supply or technological substitution 4.

Taken together, commodities have generally become cheaper over time, even relative to population.

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The Simon Abundance Index tracks how the price of a basket of commodities has evolved with time. From 1980 to 2017, the price of commodities fell by almost two thirds and world population increased by almost 70%. Source: Pooley and Tupy 5. Figure licensed by the Cato Institute under the Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License.

Energy

Since the beginning of the oil age, there has been much concern about when an ultimate peak in oil production would occur. As energy is linked to other commodities, a sustained rise in energy, especially oil, prices would likely raise the price of other commodities 6, 7, 8.

Recent predictions have de-emphasized geologic limits to oil production and emphasized limits to demand. Following are some select predictions.

Predicting Peak Oil Production
Date of PredictionRegion and Date of Predicted Oil PeakPredicted Cause of PeakSource
1919United States, perhaps by 1922Supply constraintWhite
1953United States, 1960-1970Supply constraintAyers
1953World, 1985-2000Supply constraintAyers
1956United States, 1965-1971Supply constraintHubbert
1974World, 1995Supply constraintHubbert, via Grove
2001World, 2003-2006Supply constraintDeffeyes
2011World, around 2050Reduced demandYergin
2020World, by 2030Reduced demandIEA

Sources: 9, 10, 11, 12, 13, 14, 15.

Past projections about peak oil have often failed to take into account responses to price and new technology and thereby been too pessimistic 16. For example, the United States followed the peak-and-decline prediction of M. King Hubbert 12 fairly well until 2005, after which production began rising due to the proliferation of hydraulic fracturing 17. In 2018, the United States exceeded the 1970 peak 18.

Historically, oil availability has increased incomes, and oil shortages and periods of high prices have been linked with recessions 1920. A protracted period of high prices and dwindling oil supply is likely to cause severe hardship for the world's population, unless this energy has a suitable replacement. An estimated 20 years of research and development into alternatives, in advance of peak oil, would be needed to avoid hardship 21.

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Estimated increase in energy consumption with a 10% increase in income. Source: IMF 20.

Despite abundant reserves, the peak in coal production was in 2013 22. The International Energy Agency expects this peak to hold at least to 2025, and perhaps forever, due to declining demand and climate policies 22.

The eventual peak of natural gas production has been estimated at around 2035 23 or beyond 2040 24.

At current rates and known reserves, uranium production has been predicted to last for 65 years 25, 100 years 26, or multiple centuries 27, and the ultimate peak date has been estimated at 2076 28. If unconventional sources of uranium, such as from sea water or breeder reactors are developed, then the supply may be effectively unlimited.

Farmland

The world is generally better fed today than in the past.

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Source: Food and Agriculture Organization 29.

Due to improved yields and declining population growth, not much additional land for harvesting crops is expected to be needed after 2030.

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Industrial crops (e.g. fiber crops, rubber) and cash crops (e.g. coffee, tea, tobacco) are included in estimates of harvested land and crop production. Source: FAO 30.

Climate change is expected to have a negative impact on crop yields.

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Source: 31. Several other studies, e.g. 32 and 33, also find that climate change will depress crop yields.

Both the potential increase in farmable land, estimated by the FAO 34 and World Bank 35, and expected increased farmland needs as estimated by the FAO 30 are about 30%. If food prices rise due to perceived shortage, producers can respond with, for example, high-yield agriculture such as greenhouses. For these reasons we regard famine, as a result of inability grow enough food, to be an unlikely prospect, but there is a danger of growing environmental impacts from agriculture and higher prices.

Metals and Minerals

Several metals and minerals also raise concerns about depletion or overuse. A select few are reviewed as follows.

Sand

Sand is ubiquitous on the Earth's surface, but the right kind of sand, with coarse properties, is more scarce. World production is 40-50 billion tons per year, used in largest parts for building construction and land reclamation, as well as glass, ceramics, and other uses 36, while 12.6 billion tons per year are created through natural weathering processes 37. Beyond potentially excessive resource use, sand mining, especially from rivers and sea shores, carries environmental and social sustainability problems 38. The price of sand in the United States has been going up in the 2010s.

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Sources: Yahoo! Finance 39 and YCharts 40. Monetary values are CPI-adjusted to 2020.

Metals

There should not be a peak in copper and other metals strictly as a result of depletion, but declining ore quality and weakening demand are expected to lead to peaks at the following dates.

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Estimated peak dates are for primary metal consumption; peak may be later when recycling is taken into account. Source: Sverdrup et al. 41.

Phosphorous

World economical reserves of phosphate rock, the main source of the critical element phosphorous in fertilizers, are between 60 42 and 69 billion 43 tons, or about 270-310 years of production at 2014 levels 43. However, most known reserves are in Morocco 43, posing a risk to security of supply, and reserve estimates are in doubt 44. There is not a clear reason to worry, but a thorough audit of reserves from an organization such as the Food and Agriculture Organization of the United Nations would be of value.

References

  1. Malthus, T. An Essay on the Principle of Population, as it Affects the Future Improvement of Society with Remarks on the Speculations of Mr. Godwin, M. Condorcet, and Other Writers. London, Printed for J. Johnson, in St. Paul’s Church-Yard. 1798. ↩

  2. Ehrlich, P. The Population Bomb. Buccaneer Books; Reprint edition. ISBN-13 : 978-1568495873. 1968, Hardcover edition December 1995. ↩

  3. Meadows, D., Meadows, D., Randers, J., Behrens, W. "The Limits to Growth". Club of Rome. 1972. ↩

  4. Simon, J. The Ultimate Resource. Princeton University Press, ISBN 0-691-00381-5. 1981, rev. 1996. ↩

  5. Pooley, G., Tupy, M. "The Simon Abundance Index: A New Way to Measure Availability of Resources". The Cato Institute, Policy Analysis No. 857. December 2018. ↩

  6. Bencivenga, C., Sargenti, G., D'Ecclesia, R. Energy markets: crucial relationship between prices. In: Corazza M., Pizzi C. (eds) Mathematical and Statistical Methods for Actuarial Sciences and Finance. Springer, Milano. 2010. ↩

  7. Cabrera, B., Schulz, F. "Volatility linkages between energy and agricultural commodity prices". Energy Economics 54, pp. 190-203. February 2016. ↩

  8. Taghizadeh-Hesary, F., Rasoulinezhad, E., Yoshino, N. "Volatility Linkages Between Energy and Food Prices: Case of Selected Asian Countries". Asian Development Bank Institute, No. 829. March 2018. ↩

  9. Ayres, E. "US oil outlook: How coal fits in". Coal Age 1953, pp. 70-73. August 1953. ↩

  10. Deffeyes, K. Hubbert's Peak: The Impending World Oil Shortage. Princeton University Press, ISBN-13 : 978-0691090863. October 2001. ↩

  11. Grove, N.; reporting M. King Hubbert. "Oil, the Dwindling Treasure". National Geographic 145(6). June 1974. ↩

  12. Hubbert, M. "Nuclear Energy and the Fossil Fuel". Paper presented at the Drilling and Production Practice, New York, New York, Paper Number: API-56-007. January 1956. ↩ ↩2

  13. International Energy Agency. "World Energy Outlook 2020". Part of World Energy Outlook. October 2020. ↩

  14. White, D. "The United Supply of Petroleum in the United States". SAE Transactions 14(1). 1919. ↩

  15. Yergin, D. "There Will Be Oil". Wall Street Journal. September 2011. ↩

  16. Gold, R. "Why Peak-Oil Predictions Haven’t Come True". Wall Street Journal. September 2014. ↩

  17. Patterson, R. "US Oil Production Nears Previous Peak". Peak Oil Barrel. August 2015. ↩

  18. Domm, P. "US oil production tops 10 million barrels a day for first time since 1970". CNBC. January 2018. ↩

  19. Hamilton, J. "Historical Oil Shocks". February 2011. ↩

  20. International Monetary Fund. "World Economic Outlook". April 2011. ↩ ↩2

  21. Hirsch, R., Bezdek, R., Wendling, R. "Peaking of World Oil Production: Impacts, Mitigation, & Risk Management". February 2005. ↩

  22. International Energy Agency. "Coal 2020". December 2020. ↩ ↩2

  23. Maggio, G., Cacciola, G. "When will oil, natural gas, and coal peak?". Fuel 98, pp. 111-123. August 2012. ↩

  24. Bloomberg New Energy Finance. "Global Gas Report 2020". 2020. ↩

  25. World Energy Council. "World Energy Resources". 2016. ↩

  26. Organisation for Economic Co-operation and Development / Nuclear Energy Agency / International Atomic Energy Agency. Uranium 2016: Resources, Production and Demand. ISBN 978-92-64-26844-9, 550 pages, OECD Publishing. 2016. ↩

  27. Hopf, J. "World Uranium Reserves". American Energy Independence. November 2004. ↩

  28. Zaterman, D. "Assessments of long-term uranium supply availability". Doctoral dissertation, Massachusetts Institute of Technology. 2009. ↩

  29. Food and Agriculture Organization of the United Nations. "FAO Statistical Pocketbook: 2015". 2015. ↩

  30. Food and Agriculture Organization of the United Nations. "The future of food and agriculture – Alternative pathways to 2050". 2018. ↩ ↩2

  31. Wang, X., Zhao, C., Müller, C., Ciais, P., Janssens, I., Peñuelas, J., Asseng, S., Li, T., Elliott, J., Huang, Y., Li, L., Piao, S. "Emergent constraint on crop yield response to warmer temperature from field experiments". Nature Sustainability 3, pp. 908-916. June 2020. ↩

  32. Food and Agriculture Organization of the United Nations. "Crop Yield Forecasting: Methodological and Institutional Aspects". February 2016. ↩

  33. Zhao, C. et al. "Temperature increase reduces global yields of major crops in four independent estimates". Proceedings of the National Academy of Sciences of the United States of America 114(35), pp. 9326-9331. August 2017. ↩

  34. Food and Agriculture Organization. "Global agriculture towards 2050". Office of the Director, Agricultural Development Economics Division. October 2009. ↩

  35. The World Bank. "Arable land (% of land area)". Accessed January 5, 2020. ↩

  36. United Nations Environment Programme. "Rising demand for sand calls for resource governance". May 2019. ↩

  37. Hall, M. "6 things you need to know about sand mining". Mining Technology. May 2020. ↩

  38. Pearce, F. "The Hidden Environmental Toll of Mining the World’s Sand". Yale Environment 360. February 2019. ↩

  39. Yahoo! Finance. "Sandstorm Gold Ltd. (SAND)". Accessed April 5, 2021. ↩

  40. YCharts. "US Producer Price Index: Construction Sand and Gravel Mining: Primary Products". Accessed April 5, 2021. ↩

  41. Sverdrup, H., Olafsdottir, A., Ragnarsdottir, K. "On the long-term sustainability of copper, zinc and lead supply, using a system dynamics model". Resources, Conservation & Recycling: X 4, article 100007. December 2019. ↩

  42. Van Kauwenbergh, S. "World Phosphate Rock Reserves and Resources". International Fertilizer Development Center. September 2010. ↩

  43. Jasinski, S. "Phosphate Rock". U.S. Geological Survey, Mineral Commodity Summaries. January 2016. ↩ ↩2 ↩3

  44. Edixhoven, J., Gupta, J., Savenije, H. "Recent revisions of phosphate rock reserves and resources: a critique". Earth Syst. Dynam., 5, pp. 491-507. December 2014. ↩