Although the cardon bubble in Canada has burst, all is not lost.

Clearly, Canada is no longer poised to become an energy superpower. As we’ve seen, the rapid expansion of the country’s high-cost oil sands is simply unsustainable in today’s marketplace. And still ahead (in the not too distant future) are the environmental challenges that oil sands companies will face when the world finally moves to limit carbon emissions. Survival, not growth, is the oil sands industry’s new economic imperative.

But all is not lost. As devastating as a deflated carbon bubble has been to Alberta, it and the other Prairie provinces may yet get another turn at the helm of the Canadian economy. Although the dictates of climate change will devalue the oil sands, they will at the same time boost the value of much of Canada’s arable land and its water resources. And therein lies enormous economic opportunity in a changing world…Prime Minister Harper’s folly isn’t just about betting the house on a losing sector; it’s just as much about not seeing the opportunities that climate change can bring. Having spent so much political capital — not to mention so many taxpayer dollars — on coddling the oil sands and denying climate change, it’s probably too late for this prime minister to change course now. But it’s certainly not too late for the Canadian economy, or for your investment portfolio.

As investors these days are painfully aware, virtually every commodity market has fallen in value in recent years. Since 2011, metallurgical prices are down over 60 percent, iron prices over 50 percent, and even copper, widely seen as a barometer of economic growth, is down by over a third. Those declines have pretty well put to rest the notion that the world is in some kind of “super cycle” for resource demand, as renowned investment bank Goldman Sachs once dubbed it.

That so-called super cycle was driven by exceptionally and ultimately unsustainably strong economic growth during the last decade, particularly in resource-hungry economies like China. For coal and oil markets, that oversized reliance on Chinese demand has proven to be a double-edged sword. Now that growth in the Chinese economy, as well as in the rest of the BRIC economies, is slowing, that sword is cutting the other way — into oil and coal prices, as well as into a raft of other resource markets. Investors who clung to the super-cycle notion and stayed long in those markets have been severely punished, none more so than those owning oil and coal (giving the lie to the long-held belief that “going green” means risking your portfolio; these days, as we’ve seen, going green is more of a passport to avoiding the worst-performing segments of the stock market).

But amidst this mad sell-off in commodity markets is one group that has more or less kept its pricing power: food. Not that there haven’t been some wild swings in prices from year to year based on weather-related changes in annual harvests. Comparing the American 2012 and 2014 corn and wheat harvests, for example, is a night-and-day contrast: crop prices dropped by a good 30 percent after initially rising by as much as 50 percent on the heels of the 2012 drought in the US Midwest. But as a whole, agricultural prices have proven to be far more resilient than those of other resources, be they hydrocarbons, base metals or even gold.

If you want to invest in a sector with pricing power, food should be high on your shopping list. And climate change is likely to push it even higher. The United Nations FAO Food Price Index, which tracks monthly price changes for a broad basket of international food commodities, has more than doubled over the last decade. While the same could have been said for many other commodities, most have since given back a good portion of their gains. Not food. Even today, the index is not far from its 2011 high. By comparison, and as measured by the same index, world food prices were roughly flat over the preceding two decades (1980-2000).

There are, of course, many ways to invest in agriculture. You could start with Monsanto or DuPont or any of the other seed companies that will try to re-engineer the genetic characteristics of crops so that they are better suited to the requirements of a changing climate. Or you could explore the fertilizer companies, like potash producers, that will provide those seeds with nourishment. And then there are farm equipment companies such as John Deere and Brandt, makers of the tractors and harvesters and other machines that will plant those seeds and reap those crops. In short, you can invest in all of agriculture’s technical inputs. The problem, of course, is that farming technology is constantly changing the need for those technical inputs. Farmers today invest in everything from satellite imagery to soil chemistry to try to coax the most value out of their land. Modern farming is as much about technology as it is about sweat equity. And with the challenges brought about by a shifting climate, tomorrow’s farmer will need to be even more technologically sophisticated to adapt to changes in temperature and soil moisture. Undoubtedly, farming technology will continue to change, and with it the technical inputs for growing and harvesting crops. That said, there are two inputs that will remain absolutely, unequivocally critical to farming: water and land. Without them, all the technology embodied in today’s hybrid seeds, potent fertilizers and powerful tractors won’t grow a thing.

Canada is, by any measure, blessed with an abundance of fresh water; it could also soon be blessed with strategic control over potentially year-round Arctic shipping routes. The Canadian economy could clearly benefit from seizing opportunities on these fronts. Can investors do the same? The answer is yes — and no.

It will be hard, for example, to invest in Franklin’s dream of shipping through the Northwest Passage until the federal government provides some bare-bones infrastructure in the region. At a minimum, Ottawa needs to build a deepwater port that can become a commercial nucleus on which private investment can build.

And while investing in hydro power seems attractive in an emissions-constrained world, investment opportunities are limited to small, independent generator companies that sell their power to provincial government — regulated grids. There could be more of these independents in the future — especially with the growth of smaller-scaled “run of the river” hydro projects — but the big players such as Hydro-Québec, Manitoba Hydro and BC Hydro are all Crown corporations. And even if you could invest in them, you might think twice about doing so. Carbon-neutral power generation sounds awfully appealing, but what happens on the power transmission side of the business when more and more households start to install solar and disconnect from the grid?…

Stephen Harper may ultimately be right on the money in his belief that the centre of the country’s economy lies to the west. But it won’t be Alberta’s bitumen fuelling growth, either in the economy or in your investment portfolio. There’s no longer any doubt that the world will need to cut back its combustion of oil, particularly high-cost, emissions-intensive bitumen. There’s also no doubt that this very same world, one that features a rapidly growing global population that is moving toward a more protein-rich diet, will want — and, more important, pay a high price for — all the grain that expanded crop production on a warming and potentially expanding Canadian prairies can produce. The dictates of the global market will once again dramatically change the makeup of the Canadian economy. Only this time, the global marketplace will incent Canada to produce more food instead of more oil. And in the process, those price signals will start making the economy much greener.

Today, the oil and gas sector may have three times the weighting of agriculture in this country’s GDP. That won’t be the case tomorrow. Instead of supertankers plowing up and down our Atlantic and Pacific coasts to pick up boatloads of bitumen from pipelines or rail terminals, we’re likely to see more freighters — perhaps even some following the Nordic Orion‘s route — carrying western grain to hungry overseas markets.

It’s an image that blends well with the country’s past. Farming is as much a part of this country’s history as the east coast fisheries, the fur trade or the timber industry. In the very early 20th century, the Canadian Northern Railway Company advertised the untapped farming potential of the Prairies as the “key to prosperity in the bread basket of the world.” Acres upon acres of free or cheap farmland drew legions of settlers to the vast Canadian prairies, and once there, those settlers flourished. The wheat grown on that land — King Wheat, as it soon became known — became an engine of economic growth.

Little wonder, then, that when Alberta and Saskatchewan joined Confederation in 1905, the crests designed for the new provinces paid homage to their biggest provider. Today, those crests can still be seen on the provincial flags. On Saskatchewan’s, three wheat sheaves are prominent. In Alberta’s crest, a golden field of wheat sits beneath prairie, foothills and the majestic Rocky Mountains.

If you look closely at these flags, you’ll notice something else: there are no symbols representing pipelines or bitumen mines. Not even a single oil pump. It is a stark and effective reminder of a simple fact: long before these provinces became major producers of oil, they were major producers of agriculture. As it turns out, they will be even bigger agricultural producers in the future.

In tomorrow’s world — a time of climate change and ever-tightening restrictions on carbon emissions — Canada stands a much better chance of becoming an agricultural superpower than it ever had of becoming an energy superpower. Growing food for a burgeoning global population instead of extracting bitumen for a shrinking oil market isn’t just an urgently needed change for our carbon-choked atmosphere. In a world of plunging oil prices and soaring food prices, that transition will be just as vital to our economic future.

Photo: Shutterstock

Excerpted from The Carbon Bubble: What Happens to Us When It Bursts (Random House Canada, 2015). © Jeff Rubin 2015. Used by permission.