Skip to comments.World's grain prices depend on more than just wealth
Posted on 10/30/2011 5:36:43 PM PDT by DeaconBenjamin
Conventional wisdom tells us that grain price rallies during the past few years have been caused by concerns over a rising population and rising wealth in the developing world.
As people become richer, they eat more meat, and livestock needs significant amounts of grain to fatten up.
Indeed, worldwide meat production has tripled over the past four decades and increased 20pc in the past 10 years, according to research from the Worldwatch Institute, the environment organisation.
The pressure group noted that industrial countries are consuming growing amounts of meat, nearly double the quantity in developing countries.
If this trend continues, then severe food inflation seems certain. However, research from Capital Economics suggests we are all worrying over nothing. They disagree with the conventional premise that meat consumption is responsible for rises in grain costs.
"As usual, the country cited most often in support of the conventional wisdom is China," says Julian Jessop, its chief global economist.
"Looking instead at consumption of meat in terms of calorific value, China's eating habits were already similar to those in the West back in 2007," he says.
This is largely because the meat of choice in China is pork, which generally has a higher calorie but has a lower protein content than the beef, lamb and chicken that make up a larger share of diets in Western countries.
"Of course, if someone is so poor that all they can afford is vegetables and rice, a small increase in income might allow them to start eating meat regularly for the first time," Mr Jessop says.
"However, most Chinese people moved beyond this subsistence level decades ago." When looking at Africa, this analysis may be applicable, but Mr Jessop notes there is also plenty more scope in Africa for increases in agricultural production than in China.
(Excerpt) Read more at telegraph.co.uk ...
grain is a commodity just like gold and is, therefore, subject to the same inflationary and speculative forces that drive any other commodity price up.
As people become richer, they eat more meat, and livestock needs significant amounts of grain to fatten up. Indeed, worldwide meat production has tripled over the past four decades and increased 20pc in the past 10 years, according to research from the Worldwatch Institute, the environment organisation. The pressure group noted that industrial countries are consuming growing amounts of meat, nearly double the quantity in developing countries. If this trend continues, then severe food inflation seems certain.NFW! Everyone *knows* that it's those dastardly *US subsidies* that have forced up prices for the starving have-nots of the world. Oh wait, it sez they're eating ever more meat... not starving...
B-b-but wait! FReepers KNOW that ethanol subsidies are starving all those poor people in the Third World!
I’ll just keep eating moose, caribou, and sheep.
You have not seen the consequences yet.
HR2751 FDA Food Safety Act (Food Takeover)
EXTREME drought (100+ year drought) in TX, part of OK, Part of KS, NM, Part of Colorado. Huge impact on wheat (and all grain) production.
Continuing semi-monopoly on seed production due to some consolidation with plant breeders expanding the PVPA licensing.
Cattle breed stock sell off in TX affecting at least 75% of the herds. It may take 10 years to recover that.
These all together with financial instability. Look for much higher beef prices by 2nd quarter next year.
Hope you like chicken.
And no, none of this is an exageration.
I’ll have to ruminant on that remark. ;’)
I live less than an hour from Texas. I know it is no exaggeration.
Well, I’m sure Zero will take credit for that.
I drove up to Oklahoma yesterday and bought some registered wheat seed. Only in the past 3 weeks have we had moisture enough to plant. We have enough certified seed to plant, carry-over from 2009. But in order to have seed to sell in 2012 we must plant Registered seed to produce our Certified seed.
We had been planting an A&M variety, but did not order seed early because we had no moisture to plant. In the past 2 weeks I put together the arrangements with OSU and one of their growers to try one of their varieties.
Seed licensing is a real pain, but the law requires we do all of it. It is not cheap.
We shall see where this goes. I have a feeling the drought will not continue like it was.
From Oct 2010-Oct 2011 we had 2.5-2.9 inches of rain. In one night about 2 weeks ago, we had 3.76-4.75 inches of rain and a few days ago about .8” more. The temps broke and it feels like fall.
My garden, trees, and berry bushes are thankful. I thank God daily for our blessings, especially now.