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World grain stocks running low.

http://www.financialpost.com/story.html?id=213343

The cost of food is continuing to go up with the new middle classes in the BRIC nations most specificaly India and China eating more wheat and meat together with growth in US corn derived ethanol.


Mr. Coxe said crop yields around the world need to increase to something close to what is achieved in the state of Illinois, which produces over 200 corn bushes an acre compared with an average 30 bushes an acre in the rest of the world.

"That will be done with more fertilizer, with genetically modified seeds, and with advanced machinery and technology," he said.
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Ofcourse given that US and Canadian gas is now being used to produce tar sands to oil with North American gas set to peak in the next few years and gas being how we produce fertilizer these days, meaning yet another source of energy is competing with food production.


Now a new source of food consumption is appearing, stockpiling by the wealthy.

http://www.bloomberg.com/apps/news?pid=20601101&sid=aP5DX6TWSAqs&refer=japan

Jan. 2 (Bloomberg) -- Japan, the world's biggest grain importer, plans to increase emergency stockpiles of corn, wheat and soybeans next year to ensure stable supplies at a time of soaring global prices, the Yomiuri newspaper reported.

The country plans to boost reserves, including privately held inventories, to three months of annual demand in 2009 from one to two months currently,
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As food insecurity starts to sink into the worlds leaders, those with dollars to spend appear to want to spend some of them on food security. This offcourse will mean less food available for consumption on the market driving up prices.


http://www.farmersguardian.com/story.asp?sectioncode=1&storycode=14704

The story is over a month old but UK farmers are being told to be concerned about getting the fertilizer they have paid for.

World demand is outstripping supply and farmers are being advised not only to make sure they have ordered what they need, but to take delivery and make sure they have it.

"This coming season, the most likely situation is a shortage,” said Yara’s England and Wales business manager Steven Chisholm.
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The UKs net food production may be set to fall slightly and be yet another inflationary factor in cost increases.

We here in the wealthy west wont really fell this pinch in terms of food security over the next year or two, other than rising prices. The real pain will be felt in the parts of the world dependent that have genuine poverty where the rapidly increasing dollar price of food will put it out of the reach of the poor and mean that charities and aid orginisations will only be able to buy hald the calories for the same food on the staples so will not be able to feed as many people.
 
Backatcha Bandit said:
Plenty to eat if you know where to look. :)
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lecter.jpg


Oh-oh! It's liver for supper again...

:D
 
newbie said:
Indeed. the increase in world demand, if it continues, could be the lever that encourages a return to the land from the sprawling slum cities, with that labour power being used to reclaim agricultural land that has been been unproductive in the past.
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Or might it cause big agri and governments to force people into leaving their land so they can have the land for their own use?
 
Link

Feb. 5 (Bloomberg) -- Wheat soared above $10 a bushel in Chicago and reached a record in Minneapolis on shrinking supplies of high-protein spring varieties from the U.S. and Canada, the two largest exporters.

U.S. spring-wheat inventories will total 88 million bushels on May 31, down 25 percent from a year earlier, according to government forecasts.
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Wheat for March delivery jumped 30 cents, or 3.1 percent, to $10.03 a bushel on the Chicago Board of Trade, the biggest grain market in North America. It's the second straight day the price gained the 30-cent limit allowed by the exchange. The most-active contract reached a record $10.095 a bushel on Dec. 17, partly on concern that world demand would exceed production.
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Global inventories of all wheat varieties are expected to fall to 110.9 million tons in the year ending May 31, the lowest since 1978, the USDA said last month. U.S. stockpiles may fall to 292 million bushels.
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The thing is that the US is now effectively creating millions of new virtual mouths and it is subsidising them. This is what corn ethanol is, a subsidised consumer of foods, so corn acerage takes up wheat acerage and is fed to cars. Wealthy humvee drivers are given defacto state aid to use corn in there tank.

Ofcourse this is one of the reasons that the IEA could announce that while total crude output was still bellow the alltime record total oil production for December 2007 may have been the highest ever. We are now growing our oil.

There are talks of shortages of fertilizer and perhaps not enough for demand in the US as well. Ill try find a link if I can.

Good new though is that many parts of America have recieved heavy winter rainfall helping to check the terrible droughts that some areas have. I think around Atlanata they were talking about 3 months of water left last October but heavy rains have helped with resivoirs a bit.
 
Panic in terms of food prices.

http://www.chicagotribune.com/business/chi-sat_wheat_0209feb09,0,6375433.story

Domestic inventories of hard red spring wheat, used to make bread and pasta, will fall 40 percent from a year earlier by May 31, according to the Agriculture Department. Inventories will be the lowest since 1948, economists said.

Wheat's price has more than doubled in the last year, raising costs for foodmakers, including Downers Grove-based Sara Lee Corp. and Kellogg Co. Prices have soared as adverse weather cut production.
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With wheat prices touching all-time highs, the Commodity Futures Trading Commission on Friday took steps to allow the daily limit on price moves to double, to 60 cents a bushel from 30 cents.

Additionally, the limit will rise to 90 cents a bushel on the next day after a 60-cent limit is reached.

The new price limits will take effect Monday.




The CFTC, which regulates trading on the Chicago Board of Trade and two other exchanges, made the move as wheat prices rose the limit for the fifth straight day on the CBOT, to a record $10.93 a bushel for the March contract, in after-hours electronic trading in Sydney.
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Looks like wheat if following oil into a super spike inprice. It is rising as fast as it can and they have to adjust the amount the price of wheat can rise to accomodate the price spike.

The amount of fertiliser is also probibly going to go down that will affect yeilds of wheat and corn and the cost of beef is going to jump up on the cost of feedstock.

Time for a massive rethink on this biofuel lunacy and a global stratagy on food production.
 
The increasing wheat prices of 2007 will also affect this year's production. Durum wheat seed in Greece was sold to growers at 0.66 cents per kilo rather than 0.35 that was sold last year... This is nearly 100% increase. Fertilizer prices have also increased to about 60% since September. There is a big problem with phosphorus as well as nitrogen fertilizers and in Greece it is estimated that we will experience a big shortage of fertilizers around March - April. If you combine these with the also increased fuel prices you understand that the cost of production has increased enormously and this is going to affect the prices at next year's harvest.

There is more than one reasons that all these are happening. Countries like China, are now developing within the capitalist system, which means that thousands of chinese are living the countryside and go to the cities. In the cities though they can not produce therefore they have to buy to eat. Also life in the cities increases meat consumption therefore more wheat and grains in generall will be needed in order to produce meat to meet the consumption demands.

China has also started to import massively fertilizers in order to apply them to their own grain and rice productions. The world price of materials such as DAP and Posphate Rock have increased about 100% because of this.

Production of food for biofuel is also an another problem. The aim is the use of biofuels to increase therefore more wheat, maize, oilseed rape etc will needed to be produced.

Drought is of course an another big problem. We experienced a very hot year, with temperatures leading up to 39 C in Russia (!!), 41 C in some parts of Germany (!!) and about 47 - 48 C in Greece. Problems with drought also existed in Australia and New Zealand, all these causing problems with yields. The effects of global warming are getting more and more evident to the environment but also our lifes.

All these lead to increasing food prices, the salaries of the workers are not increasing though. We have to buy a loaf of bread for 1.60 euros instead of 1.00 (60% increase) but we did not get a 60% pay rise in order to match this..

Conventional growing practices are a problem as they use too many resources in order to gain maximum production. We have built a system completely based on increasing yields, therefore we overuse fertilizers and pesticides in order to gain those targets, polluting the environment on the same time. The use of Intergrated Crop Management systems which will lead to sustainable production is more than essential. For example we can gain good yields without using excessive ammounts of fertilzers, but with the use of biostimulants which will increase fertilizer uptake rate. We have to stop deforastating land in order to turn it to agricultural, we have to take care of wildlife, the ecosystem in general. In this way we may manage to maintain our current yields without creating more environmental problems which finally affect production as well, as we see happening this year.

One more thing as well. I have had enough with the myth that we do not produce enough in order to feed our current population. This is the myth that the Biotechnology companies also want to spread in order to support their GM products. We actually overproduce food, if anybody wants to research the malnutrition problem has to take in account the politics of those regions, the civil wars that are happening for years, the fact that we do not export our food to these countries but prefer to throw it away or turn it to biofuel instead etc. Production exists, Africa can also produce their own food, the point is to manage this production correctly in order to solve the problem. Pressing new regions like China and Africa to overproduce using the current conventional intensive production systems is wrong, as it is going to result to even more mineral shortage and environmental pollution...
 
India bans rice export.
http://www.atimes.com/atimes/South_Asia/JB14Df02.html

A couple of natural disasters and it seems Bangladesh is in alot of trouble feeding itself. Not all bad news as there seems longterm plans to massively increase yeilds.

In other news some spot selling of wheat in America has hit $20 a bushell as there is none left for the millers, they are paying silly money to make bread. The $20 dollar figure is not likely to be sustainable but it is indicative of how tight wheat is being squeezed. Given that futrures are trading at over $12 now we can expect wheat acerage to grow this year in the states but if farmers get these kind of prices in futures sales they will have enough income to out bid everyone for fertilizer increasing pressure on costs and diminishing supply putting pressure on other crops costs and yeilds.

Mostly fuel but also food causes riots in Mozambique
http://news.bbc.co.uk/1/hi/world/africa/7242323.stm
So far it has been fuel in places like Burma and Mozambique causing instability. If there is a near doubling of food prices in countries like this there could be hell to play.

I cant shake the feeling that these problems have been eminently avoidable but the worlds leaders have had there eyes of the ball. (hence how some of the financial disasters like option arms have been allowed to grow in the US.)

God it must really suck being amoung the worlds poor these days.
 
http://www.atimes.com/atimes/China_Business/JB21Cb01.html

China imposes export restriction as production falls bellwo demand for the fifth year running. Inflation is already pretty high without taking into account the super spike in grains futures through January/ February and now oil back at near $100 barrel. Hu Jianto has spoken against using government cash reserves to import buy large amounts of grain on the world markets as he feels this will undermine local farmers and food security.

http://www.atimes.com/atimes/South_Asia/JB21Df01.html

Pakistan though seems to be going to hell in a hand cart. Increasing oil prices mean less energy is available so less is being produced to be exported. Its balance of trade is falling through the floor, which weakens the currency makes everything more expensive.....

So Pakistan is facing an increasing budget deficit, a potentialy decreasing economy, more mouths to feed and oil and food skyrocketing.

It has a choice of oil or food. Oil for helicopters and trucks in Waziristan, Balochistan and Kashmire or oil for its factories or food for its people. Given the super spike has seen wheat jump from $2 per bushell to $10 in 18 months then in one exchange above $20 in one month this could all go horribly wrong.

Chinese taste for beef, American desire for energy independnce and terrorism in India and Afghanistan. Its all connected.
 
Prices for top-quality spring wheat have jumped by 90 per cent in the past month and a half, boosted by a scramble by corporate consumers to secure scarce grain and speculative buying by investors.

A surge on Friday in prices for wheat used in bread to an all-time high of $19.88 a bushel – the highest yet paid for any wheat contract and a three-fold increase from a year ago – prompted the US baking industry to call for wheat exports to be curtailed.


“It is currently at a very low one-month level, which is extremely concerning,” she said.

Cereals traders said it was unlikely Washington would support export curtailments, but added that the call highlighted the tightness of the market.

The US is the world’s largest wheat exporter. Faced with strong overseas demand after extreme weather damaged other countries’ crops, its wheat stocks are set to fall to a 60-year low this year.
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http://www.ft.com/cms/s/0/bab47e26-dd85-11dc-ad7e-0000779fd2ac.html?nclick_check=1

Well what was originaly being portrayed as a local problem in the Mid West when wheat futures hit $20. Now it seems that £20 wheat is the price for this year.

I am going to stick my neck on the line and say this will kill the biofuel industry. Alot of famers who planted corn instead of wheat to reap in the fat juicy biofuel profits will plant wheat again this year, bringing the price down a bit. This will spike the corn price pushing up the cost of corn based staples even further but spiking the input costs of biofuel factories. If they cant turn a profit with $100 oil then they are never going to turn a profit. The need for budget cuts in the US coupled with such an easy to demonstrate display of the real cost of biofuels could hopefully give the presidential candidates a chance to step away from this criminal lunacy.

I could be wrong. I am trying to be optimistic.
 
Corn was always a stupid way of making fuel anyway. It's an intensive, fertilizer heavy crop that fucks up the soil. Switchgrass is where it's at, apparently. (or bacteria + algae in great big vats)

Oh, this was my 25,000th post btw. Woo.
 
david dissadent said:
http://www.ft.com/cms/s/0/bab47e26-dd85-11dc-ad7e-0000779fd2ac.html?nclick_check=1

Well what was originaly being portrayed as a local problem in the Mid West when wheat futures hit $20. Now it seems that £20 wheat is the price for this year.

I am going to stick my neck on the line and say this will kill the biofuel industry. Alot of famers who planted corn instead of wheat to reap in the fat juicy biofuel profits will plant wheat again this year, bringing the price down a bit. This will spike the corn price pushing up the cost of corn based staples even further but spiking the input costs of biofuel factories. If they cant turn a profit with $100 oil then they are never going to turn a profit. The need for budget cuts in the US coupled with such an easy to demonstrate display of the real cost of biofuels could hopefully give the presidential candidates a chance to step away from this criminal lunacy.

I could be wrong. I am trying to be optimistic.
Click to expand...


The US Biofuel industry would already be bankrupt if it were not for massive subsidies , can you believe that it is currently feasable to ship biodiesel from the far East to the US , touch it up a little in what is called a " splash and dash " collect the subdsidy and then re-export to Europe and undercut the local market here. The European Bio market is in tatters because of this , not to mention the energy used to make such a voyage possible

It will all end in tears but only if we get a democrat as the next US pres , otherwise the madness will continue,
 
even teh Economist agreed with Fidel castros public damming of the US biofool industry late last year - a first IIRC

its a defacto subsidy to the agrariin lobby in the US rather than a drive towards "green" sources
 
here has never been anything remotely like the food crisis that is now increasingly gripping the world, threatening millions with starvation. For it is happening at a time of bumper crops.


All the familiar signs of impending disaster are here, and in spades. Across the developing world already hungry people are now having to eat even less. Food stocks have plunged to record lows. Food prices have scaled new heights. Food riots are spreading around the globe. Yet the world is still harvesting record amounts of grain.

Three times over the past 60 years prices have soared in the same way. But each was the result of poor harvests, and each was reversed when good crops returned. This crisis is being caused not by shrinking supplies but by skyrocketing demand.

"This is the new face of hunger," said Josette Sheeran, the executive director of the UN's World Food Programme. "There is food on the shelves, but people are priced out of the market." Indeed, so great are the price rises that both her organisation and the US government's Agency for International Development, which buy their supplies on the open market, are having to draw up plans to cut back their aid.

Wheat prices have doubled in a year – and in just one day last week they shot up by 25 per cent. Stocks are lower than at any time since records began.

The chief reason for the escalating demand is the mushrooming middle class in developing countries, especially China and India, now growing by 50 million people a year. As people get better off they demand more meat, which mops up grain supplies, since it takes some 8lbs (3.5kg) of cereals to produce 1lb (450g) of beef.
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http://www.independent.co.uk/enviro...h-starvation-despite-bumper-crops-790319.html

On the other hand apparenlty 6% more land will be planeted for wheat this year, and Australia is predicting a bumper harvest.
 
nino_savatte said:
The thing is, we as a planet have got our priorities wrong. The current system of capitalism is geared towards over-production, waste and death. We now have economists and others talking about the need to grow plants for bio fuel but the understanding of energy requirements appears to revolve around the internal combustion engine (it's so 20th century). Furthermore the current drive for the production of bio-fuels, which is meant to address carbon emission and the reduction of oil reserves, ignores the need for food production. Instead, we have richer countries dumping their cheaper products on the markets of so-called developing countries. This is what is commonly called "Free Trade". :rolleyes:

The current way in which the science of economics is practised -at least according to my observations - is narrow and orbits the sphere of commodity production and the consumption of those commodities (produce meaningless crap for people to buy and give them a justification for doing so) at the expense of other goods.

Adam Curtis is right: there are two types of people who are irrational and who work in their own self-interest: they are psychopaths and economists.

I'm sure an economist will come along and put me right. :)
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Over production reduces the price hence the value of a comodity. There is only overproduction from a measure of the earths resources. This should be addressed by government legislation and tarrifs to increase the cost of consumables reducing demand for them, but this will lead to an inevitable reduction of economic activity.

The whole thing about capitalism is a red herring. Other systems did not use as much resources simply because they could not generate the economic activity not because they were more moral.
 
david dissadent said:
Over production reduces the price hence the value of a comodity. There is only overproduction from a measure of the earths resources. This should be addressed by government legislation and tarrifs to increase the cost of consumables reducing demand for them, but this will lead to an inevitable reduction of economic activity.

The whole thing about capitalism is a red herring. Other systems did not use as much resources simply because they could not generate the economic activity not because they were more moral.
Click to expand...

You took your time. How many months was that now?

You've clearly missed my point about capitalism in order to purse your narrow discursive agenda.

Waste is one of the cornerstones of commodity production/consumption.

You also missed my point about bio-fuels. I guess that's a wee bit too much for you - non?
 
david dissadent said:
How?
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Do I need to draw you a picture? :rolleyes:

Let me frame this reply as a question: in the pre-industrial age, was there over-production and if so, how much waste was there as a result? Were needs (that previously didn't exist) stimulated in order to create new markets for the sale of useless commodities?
 
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