Posted on 02/25/2008 5:08:27 AM PST by TigerLikesRooster
America's grain stocks running short
By Robert Pore robert.pore@theindependent.com
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Global demand for grain and oilseeds is at record levels, causing the nation's grain stocks to reach critically low levels, according to Purdue University agricultural economist Chris Hurt.
With a weak U.S. dollar and global demand so high, foreign buyers are outbidding domestic buyers for American grain, Hurt said.
"Food consumers worldwide are going to have to pay more," Hurt said. "We ended 2007 with our monthly inflation rate on food nearly 5 percent higher. I think we'll see times in 2008 where the food inflation rate might be as much as 6 percent."
Increasing food costs will ignite the debate on food security this year, Hurt said.
"We'll have discussions about whether we should allow the foreign sector to buy our food," he said. "Is food a strategic item that we need to keep in our country?"
The USDA recently released a revised forecast for agricultural exports, predicting a record of $101 billion for fiscal year 2008.
According to the U.S. Grains Council, a significant increase in feed grain exports buoyed the forecasts. Specifically, the forecast for coarse grain exports is raised to 70 million tons, up 2 million tons since November. Corn and sorghum exports are up $2.4 billion from November. Coarse grain exports are forecast at $14.1 billion, $4.3 billion above last year's level.
Hurt said the 2007 U.S. wheat crop is virtually sold out, while domestic soybean stocks soon will fall below a 20-day supply. Corn inventories are stronger, but with demand from export markets, the livestock industry and ethanol plants, supplies also could be just as scarce for the 2008 crop.
More than 70 percent of Nebraska corn crop this year could go to ethanol production.
But what concerns Hurt the most is weather. Adverse weather could trim crop yields this year and cause crop prices to skyrocket even further.
Last year, Nebraska had a record corn crop of nearly 1.5 billion bushels. But rainfall was exceptional last year, especially during the growing season, which helped increase crop yields.
He said recent cash prices for wheat, soybeans and corn are up dramatically from two years ago. Wheat prices have been near $10 a bushel, more than $6 a bushel higher. Cash prices for soybeans are about $13 a bushel, up more than $7 a bushel. Corn is pricing at almost $5 a bushel, an increase of greater than $3 a bushel.
Ping!
That’s ok... McCain supports increasing US ethanol production, which will fix global warming, which will save us all!
Uhh, wait a minute...
Won’t be long, now, before we’ll have to have family meetings to decide whether to spend our life savings on a gallon of gas or a loaf of bread......
Funny how that works: with a weak U.S. dollar and global demand so high, U.S. producers can't ship American grain quickly enough. Oh, heck, we're all gonna starve.
—With a weak U.S. dollar and global demand so high,—
Duh! The answer is keep the grain at home; restrict exports. That will help drop the price of grain (and milk and eggs) at home. The ag lobby won’t like that, but tough darts.
farmers won't much like it either.
—farmers won’t much like it either.—
six of one ...
What do you think happens when the government artificially depresses prices for a commodity? How do the producers react?
Duh. And what explicit numerated power in the US Constitution allows the US government to do that? Answer: there is none. And don’t give me bs about the commerce power. Ditto for export restrictions on a number of other items. It just doesn’t exist. So many conservatives say they support the Constitution, but they really don’t.
If they pull the same crap they pulled back in 1973 like slaughtering calves and chicks before they went to market, then their arses should be tossed in jail.
You’re going to have to explain why you think one form of intervention is bad, and the other good.
The necessary and proper clause (also known as the elastic clause, the basket clause, the coefficient clause, and the sweeping clause. This clause is a loophole big enough to drive a Hummer through, which is probably why the Framers put it in the Constitution in the first place.
—You’re going to have to explain why you think one form of intervention is bad, and the other good.—
Allowing prices to go up because greedy speculators are shipping it overseas to non-Americans is not intervention, it is NON-intervention (letting a house burn down is non-intervention, putting the fire out before it does too much damage is intervention).
What do you think happens when the government artificially boost prices for a commodity, i.e., farm subsidies? The USG has been subsidizing farmers for a long time. It has never been a free market.
Da, comrade. The kulaks are enemies of the State.
Why are you asking me? I’m honestly curious.
Hey, I know. Let’s tax American workers and use the money to subsidize unprofitable ethanol plants, and then charge them more for food and energy, and tax the margin (of course)!
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