Posted on 04/15/2008 11:06:14 PM PDT by bruinbirdman
The global food crisis intensified on Tuesday as Kazakhstan, one of the world’s biggest wheat exporters halted foreign sales and rice prices shot to a record high after Indonesia stopped its farmers from selling the grain abroad.
In another sign of turmoil, a big food company in Japan, Nihon Shokuhin Kako, said high corn prices had forced it to buy cheaper genetically modified corn for the first time, breaking a social, though not legal, taboo and signalling that opposition to GM foods could weaken in the face of record food prices.
Meanwhile, fresh wheat export curbs in Kazakhstan, the world’s fifth largest exporter, and the rice bans in Indonesia, threaten to trigger bans in other food exporting countries, which will now face much higher demand from importing countries.
Hussein Allidina, at Morgan Stanley in New York, said pressure for export bans was likely to increase elsewhere as developing countries suffering high inflation tried to combat rising local prices by cutting back on exports of agriculture commodities.
Indonesia – which joins Vietnam, Egypt, China, Cambodia and India in banning foreign sales – was expected to export the grain this year due to a bumper crop. Corn futures prices in Chicago last week hit a record $6.16 a bushel, up 30 per cent in the past three months.
Indonesia’s export ban boosted the price of rice futures in Chicago to a all-time high of $22.17 per 100 pounds, up 63 per cent since January. Wheat prices moved higher to $9.11 a bushel and traders warned prices could rise further as the Kazakhstan ban together with restrictions in Russia, Ukraine and Argentina have closed a third of the global wheat market.
The Law of Unintended Consequences bites again.
You can’t keep prices artificially low. Value of money is just imaginary unless backed up by precious metal. If the governments of the world keep printing money, the bubble sure is gonna burst.
I don’t know if commodity prices were artificially low, but the recent spike in grain prices is tied to the heavily subsidized bio-fuel programs which have been great for the farmers but not so good for consumers, particularly in the Third World. This has been spurred on by the expectation that governments will continue to push bio-fuels and therefore less land is going to be available for feedgrains.
And furthermore, because the governments in question will want to be seen to be helping the poor they will then subsidize either the purchase or the cost of grain while at the same time continuing to subsidize the ethanol and other bio-fuel programs.
So no one gets ahead because we are all standing on tiptoes. Madness!
Agriculture markets are manipulated by every country on earth. Farms everywhere benefit from subsidies, and usually massive subsidies, at that.
Perhaps Big Ag has decided that enough small farmers have been driven off of the land so that they can finally make their move. Hungry people will do anything to get food. Those who have food will have power that money can’t buy. Some old book has a line in it about people throwing their gold and silver into the streets because they are of no worth.
It is ALL AL Gores fault and he should be brought to trail on crimes against humanity.
LOL! I would pay for a ticket to the trial. Unfortunately, life isn’t that fair and instead he gets the Nobel Peace Prize.
Some Japland importers are buying genetically modified corn. Sumpin' must be going on. I notice they didn't start importing more California rice, though.
yitbos
I’m waiting for some story that says small farmers need government subsidies to afford “expensive seeds”.
I don’t recall Al Gore giving a State of the Union speech in 2006 saying that Americans are addicted to oil and pushing ethanol.
This just goes to show the influence farmers (at least here in the US) have over Congress--not to mention the power of the EnviroNuts.
There are about 2,000,000 farms, many of which have consolidated or been bought out by conglomerates and 300,000,000 of us who end up paying thru the nose for their subsidies--not only now for biofuels, but the continued ludicrous practice of being paid NOT to grow certain crops.
This entire food price explosion here as well as food shortages around the world, is simply, insanity.
Unfortunately, we now have a Compassionate Conservative in the Oval Office who has gone over (for God knows what reason) to the dark side and all 3 morons running as his replacement are even worse.
The value of them is pretty dammed imaginary, too.
Your oz. of silver will only buy you as much rice as the person that has the rice believes is worthwhile.
Metal is not magic, sometimes it is just another medium of exchange, no different than paper with serial numbers on it. You cannot eat either and precious metals are totally unsuitable for liar's poker.
Seed corn is 190 bucks a bag(plants 2.5 acres)and soybean seed is 38 bucks a bag(takes approx.2 bags to plant 1 acre).If anybody wants to send me some money I’ll gladly accept it.
All the while we're turning food into motor fuel, China is stealing our oil by slant drilling from the Cuban side of the Florida Straits into what American oil companies say may be several trillion barrels of crude that Congress won't allow American companies to touch because they might foul Florida's beaches with oil spills. We seem to be committing economic suicide to keep FL beaches clean when Chinese oil drillers couldn't possibly care less about FL beaches as long as they get our oil.
Powder..patch..ball FIRE!
Bio-fuels are the only reason?
How about the falling dollar???
That "old book" is the Bible. The book of the Apocalypse predicts a future time when an average day's pay will buy just enough food to feed one person, and a pound of wheat will be worth a pound of gold. That day may not be too far off at the rate Kroger's prices are going up every time I go into one.
I don`t know how much we can blame the stopping of wheat and rice exports by Asian countries on the burning of corn for fuel in the US. And as much of a jerk Gore is, he`s no big fan of biofuels.
http://www.energyportal.eu/news/biomass/al-gore-warns-against-negative-effects-of-biofuels.html
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