The smallest corn inventories in 37 years are a sign that farmers around the globe are failing to produce enough grain to meet rising consumption, according to Bloomberg.

Growers from Canada to Russia have increased their annual output of wheat, rice and feed grain by 16 percent since 2000, but that is not enough to keep up with the 20 percent gain in demand, according to U.S. Department of Agriculture data. A Bloomberg survey of analysts forecasts a 3.5 percent increase in U.S. corn planting this year, but the government says world stockpiles will equal 15 percent of use, the lowest since 1974.

Increasing demand globally is causing isolated food shortages and accelerating inflation in developing countries even as it boosts farmers’ incomes.

“We need to grow a huge crop this year to meet global food needs,” said Paul Jeschke, who farms 3,600 acres near Mazon, Ill., and plans to boost his corn planting by 50 percent because the crop is as much as $200 per acre more profitable than soybeans at current prices. “The increased demand for meat and dairy is driving demand for corn and soybeans.”

Rising incomes in developing countries are boosting food prices as people eat more meat and dairy products from crop-fed livestock. U.S. subsidies are fueling demand for ethanol made from grain, and global harvests were damaged by floods and droughts in 2010.

“Corn supplies are going to be extremely tight this year,” said Loyd Brown, President of Hertz Farm Management Inc. in Nevada, Iowa., in an interview with Bloomberg. “When you consider that U.S. farmers harvested the third-largest crop last year, that means this is a demand market. You have to be bullish on agriculture. Global economic growth is driving demand for improved diets, and rising populations continue to boost exports.”