[Home]  [Headlines]  [Latest Articles]  [Latest Comments]  [Post]  [Mail]  [Sign-in]  [Setup]  [Help]  [Register] 

Who Is Bill Gates? (Full Documentary, 2020)

Here Is What Republican Voters Really Believe in. It's a Shame the GOP Has No Idea

guTTing america ... going back --- on Track

“The ElecTion is Over”... Trump HaTer Cindy McCain Trashes Arizona ElecTion AudiT ---“Ludicrous” (VIDEO)

DissidenT Episcopalians awarded $100 million worTh of property ... as U.S. Supreme CourT --- declines To Take up Fort WorTh case

Joe Biden needs to stop lying about the cause of the border crisis and start fixing it

George W. Bush says ... The Republican ParTy has a shoT aT fuTure elecTions if iT curbs --- iTs 'whiTe Anglo-Saxon ProTesTanTism' ( heriTage )

BREAKING EXCLUSIVE - TGP’s Jordan Conradson InTerviews AZ AudiT DirecTor Ken BenneTT — HUGE DEVELOPMENTS ... Including Plans To Triple OuTpuT --- QuesTions on Number of FraudulenT BalloTs (VIDEO)

Can Democrats Avoid a Wipeout in 2022?

Biden declares war on America -- literally

Former Trump assisTanT says ... 'freighT Train' of elecTion resulT audiTs coming --- 'The MAGA movemenT is demanding answers'

Tim Scott's 2024 Star Rises After Biden Rebuttal

“We Will Find MisTakes – IrregulariTies ... We Probably Are Going To Find OuTright Fraud” --- AZ GOP Chair Dr. Kelli Ward Give - UpdaTe on HisToric AudiT (VIDEO)

Australia security official warns nations are ‘beating drums’ of war amid Asia-Pacific tensions

Former Obama White House advisor Seth Andrew arrested, accused of stealing from charter school he founded

This is fo sucking funny ... Joe has no clue --- The dumbocrap leaders are in a hearT aTTack panic!!.

The voter suppression lie

War Room ... Rachel Maddow Is Worried abouT whaT AZ ElecTion AudiT will Find — She Knows Georgia Is NexT

Conspiracy Queen Rachel Maddow ... Panics Over --- ‘Dangerous’ Arizona Vote AudiT

‘True To iTs docTrine’ ... ConservaTives plan for a new church afTer UniTed MeThodism spliTs --- over homosexualiTy debaTe

Michael Eric Dyson - WhiTe People Can Help BLM ...by Holding RacisT RelaTives --- ‘To AccounT’ aT Thanksgiving

Derek Chauvin ... The GreaT --- WhiTe DefendanT

New Mexico state trooper executed by Mexican cartel member… Horrific Video

John Kerry in Earth Day wonderland

Democrats Are Cheaters

Derek Chauvin's FaTe ... Is Now in The Hands --- of The Jury

Fools' overture

Democrats Are Terrified of Georgia

Climate Media vs. Climate Science

Why We Black Leaders Support Voter ID Laws

Pelosi: ‘No Plans' to Bring a Court-Packing Bill to the House Floor – at This Time

B-1 Bombers Are Deploying To Norway For The First Time With An Eye On Nearby Russia And The Arctic

High School Coach Fired After Refusing To Enforce “Insane” Outdoor Masks During Sports

CNN Says Chinese-Style Fonts Are Racist

Gran Torino Denounced for Anti-Asian Racism

'It Is Still Not Safe To Go Outside,' Says Fauci's Head In A Jar In Year 2739

Biden Re-Ignites the Waco Fire

Over 500 White People Have Been Killed By Cops Since 2020. There Has Been No Rioting Over Those Deaths.

Buttigieg on Exaggerated Infrastructure Jobs Estimate: ‘I Should Have Been More Precise’

Videos - ChrisTians Tear Down MeTal Fences ... Denounce The Closure Of GraceLife Church --- Due To A COVID-19 ResTricTions

Pete BuTTigieg ... To evangelical vaccine hold-ouTs --- Maybe iT's parT of God's plan

TINHORN FLATS ... The Symbol of Modern Day America --- AgainsT Tyranny

This Trial is a ToTal sham ... The enTire power of The sTaTe - media - lefT-wing shock Troops - counTry's finesT legal TalenT ... is being deployed againsT Derek Chauvin.

A few billionaires currenTly have The power To decide ... ThaT some Americans’ speech righTs are more sacred Than oThers --- Clarence Thomas offers a remedy.

Biden Defense Secretary Orders Several “Immediate Actions” to Weed Out ‘Extremism’ in the Ranks

Target selling book that includes prayer to 'hate white people' in 'Religion' section

America is losing its religion — and the effects will be long-lasting

Conservative Grassroots Begin to Take Back Wisconsin

Ron DeSantis Is What the Post-Trump GOP Should Look Like

White House pushes back on conservative argument over Georgia, Colorado voting laws amid MLB dispute

Status: Not Logged In; Sign In

See other Business Articles

Title: Global Food Reserves Falling as Drought Wilts Crops
Source: Bloomberg
URL Source: http://www.bloomberg.com/news/2012- ... t-wilts-crops-commodities.html
Published: Aug 9, 2012
Author: Tony C. Dreibus and Elizabeth Campbell
Post Date: 2012-08-09 11:47:06 by Brian S
Keywords: None
Views: 541

Stockpiles of the biggest crops will decline for a third year as drought parches fields across three continents, raising food-import costs already forecast by the United Nations to reach a near-record $1.24 trillion.

Combined inventories of corn, wheat, soybeans and rice will drop 1.8 percent to a four-year low before harvests in 2013, the U.S. Department of Agriculture estimates. Crops in the U.S., the biggest exporter, are in the worst condition since 1988, heat waves are battering European crops and India’s monsoon rainfall already is 20 percent below normal. The International Grains Council began July by forecasting record harvests. It ended with a prediction for a 2 percent drop in output.

The speed of the destruction drove corn prices to a record today and soybean prices to an all-time high last month, while wheat went to a four-year high. For investors, crops are the best-performing commodities this year, and Goldman Sachs Group Inc., Macquarie Group Ltd. and Credit Suisse Group AG say the trend will continue. An index of 55 food items tracked by the United Nations’ Food & Agriculture Organization jumped 6.2 percent in July, the biggest monthly increase since November 2009, the Rome-based agency reported today, less than two years after record prices pushed 44 million people into extreme poverty and contributed to uprisings in North Africa and the Middle East.

“People thought we were going to be swimming in corn by the end of the year,” said Kelly Wiesbrock, who helps manage $1.3 billion of assets for Harvest Capital Strategies, a San Francisco-based hedge fund. “Then the month of June hit and into July, and it’s just been a train wreck.”

Top Commodities

Wheat gained 41 percent to $9.1825 a bushel this year on the Chicago Board of Trade, soybeans appreciated 32 percent to $15.89, and corn rose 27 percent to $8.2375, after earlier today touching a record $8.265. They were the biggest advances in the Standard & Poor’s GSCI Spot Index of 24 raw materials, which increased 2.3 percent.

The U.S. drought in June was the widest since December 1956 and the past 12 months were the hottest on record, weather data show. While the USDA anticipated a record harvest as recently as June, it cut the domestic corn forecast by 12 percent on July 11, the most since at least 1990. The estimate will be reduced again when the department reports Aug. 10, according to the average of 29 analyst forecasts compiled by Bloomberg.

The American drought is spreading beyond agriculture into power and fuel production. U.S. nuclear plants’ output on July 27 was the lowest for the day since 2001 because water was too hot to be an effective coolant, government data show. Parched conditions will spread into North Dakota and central Texas through October and last across the Midwest, the main growing region, the Camp Springs, Maryland-based Climate Prediction Center said Aug. 2.

Ethanol Mandate

More than 150 lawmakers urged President Barack Obama on Aug. 2 to cut the government mandate for ethanol production, saying high corn costs are hurting livestock producers, food makers and consumers. Ethanol makers including Poet LLC and Archer Daniels Midland Co. (ADM) back the mandate, as mounting industry losses curbed daily output by 15 percent since the end of December, Energy Department data show.

The lack of rain is also pressuring natural-gas drillers to conserve the millions of gallons of water used in hydraulic fracturing to free trapped gas and oil from underground rock. Environmentalists in Texas are lobbying lawmakers to pass water- conservation laws next year. In Pennsylvania, the Susquehanna River Basin Commission suspended water intake for companies including Talisman Energy Inc. and Chesapeake Energy Corp. (CHK) on July 16.

South America

The USDA still expects a domestic corn harvest of 329.45 million metric tons this year, the third-biggest ever, and Canada, the world’s No. 3 wheat exporter, predicted a 4.1 percent gain in output on July 16. Higher prices also are encouraging more planting in South America. Argentina will reap a record corn crop of as much as 31 million tons, growers group Crea said July 23. Brazil will probably surpass the U.S. as the biggest soybean producer, Sao Paulo-based researcher Agroconsult estimates.

While global wheat inventories are forecast by the USDA to contract 7.5 percent next year, more than any other major crop, they would still be 42 percent larger than in 2008. Droughts, freezes and floods that year damaged crops from Australia to Argentina to the U.S., driving the grain to a record $13.495 in Chicago. Global food prices measured by the UN are still 10 percent below the record reached in February 2011.

Declining Demand

Given this year’s gains and increased speculation, investors should pare bets on higher prices, Barclays Plc said in a report Aug. 3. Improving weather, declining demand or an easing of U.S. requirements for ethanol in gasoline may send prices lower, London-based analysts Kevin Norrish and Sudakshina Unnikrishnan wrote in the report. The bank remains “modestly overweight” in grains and soybeans.

Goldman said Aug. 2 that corn will reach $9 in three months. The New York-based bank also said soybeans may rise to $20 in three months, topping the all-time high of $16.915 set July 23, and wheat may jump to $9.80.

Costlier grain means global food prices will jump 25 percent this year, Danske Bank A/S said July 16. The UN estimates imports of everything from fruit and vegetables to dairy products and cereal will top $1 trillion for a third consecutive year, with a 13 percent gain for meat as higher feed costs spur farmers to reduce herds.

Kenya Food

The impact won’t be shared equally, with U.S. households spending 6 percent of their total expenditures on food, compared with 35 percent in India and 45 percent in Kenya, data from the Gates Foundation show. The U.S., with less than 5 percent of the world population, consumes 31 percent of global corn production, 18 percent of soybeans, 32 percent of cheese and 20 percent of beef and veal, according to USDA data.

Nations reliant on food imports, including Egypt, Pakistan, Bangladesh and Sudan, are especially vulnerable to unrest, according to a May 10 report by the National Intelligence Council, an adviser to the U.S. government. More than 60 food riots erupted worldwide from 2007 to 2009 as prices surged, the U.S. State Department estimates. Production will need to expand 70 percent by 2050 as 2 billion people are added to the population, according to the UN.

Retail-food costs will rise as much as 4 percent next year, the USDA said July 25. That will add pressure to consumers and Obama’s election bid in November, said Tim Hagle, a political science professor at the University of Iowa in Iowa City.

“It keeps the economy in sort of a fragile position,” he said. “That’s the big issue for this particular election.”

Insured Crops

Farmers in the U.S. are less likely to feel the pinch because about 85 percent of crops are insured, said Steve Hatz, a senior vice president and regional manager of the agribusiness unit of San Francisco-based Bank of the West, the second-biggest U.S. agricultural lender after Wells Fargo & Co.

President Obama announced $30 million in aid to farmers and ranchers on Aug. 7, mostly to get more water to livestock and rehabilitate scorched land.

U.S. net farm income, based on USDA estimates in February, was set to slip this year to $91.7 billion, second only to last year’s all-time high of $98.1 billion. The agency is scheduled to update its forecast on Aug. 28.

Spreading Drought

The price of corn fell 1.8 percent in the first half of 2012 as farmers sowed the most acres since 1937. The USDA had rated 77 percent of the crop in good or excellent condition on May 18, and by June 15, futures on the CBOT were down 22 percent for the year. As the drought spread during the past seven weeks, the grain has surged 63 percent. The U.S. agency rated 23 percent of the crop as good or excellent on Aug. 3, the lowest proportion since 1988.

The USDA probably will pare its corn-crop forecast by 16 percent to 10.929 billion bushels, the lowest in six years, from last month’s estimate of 12.97 billion, according to the average of 29 analyst estimates compiled by Bloomberg. The soybean forecast probably will be cut to a five-year low of 2.796 billion bushels.

The London-based International Grains Council reduced its global grain production forecast on July 26 to 1.81 billion tons, from a prior estimate of 1.868 billion. While it expects 4 million tons more rice, any gains will be eclipsed by the 36 million-ton slump in supply of wheat and so-called coarse grains.

Indian Monsoon

Wheat production in Russia, the fourth-largest exporter, will decline 20 percent this year, and in Australia, output will fall 19 percent, the council said.

India’s monsoon, which accounts for more than 70 percent of annual rainfall, was 17 percent below the 50-year average since June 1, the nation’s weather bureau said Aug. 6. The government extended a ban on exports of sugar, rice and wheat in 2009 after the weakest monsoon in almost four decades. The UN’s Food & Agriculture Organization cut its global rice-production estimate by 1.1 percent on Aug. 6 because of the monsoon.

U.S. livestock producers are being hurt again less than a year after drought caused a record $7.62 billion in farm losses in Texas, the biggest cattle-producing state. The domestic herd shrank to 97.8 million head by July 1, the smallest for that time of year since at least 1973. Ranchers lost $260 a head in June, from a $156 loss a year earlier, said Ron Plain, a livestock economist at the University of Missouri in Columbia.

U.S. beef supplies are already forecast by the USDA to decline 4.4 percent this year to 11.469 million tons, the lowest since 2005. U.S. retail-beef prices rose to a record $4.709 a pound in June, USDA data show.

Rising Incomes

Global inventories are being eroded in part because rising incomes in emerging markets mean consumers want to eat more meat, said Steve Shafer, the chief investment officer at Oklahoma City-based hedge fund Covenant Global Investors, who helps manage $315 million of assets.

“You’ve got two to three billion people on the other side of the planet who are bootstrapping their way out of poverty,” he said. “You’re going to see a rising supply-demand imbalance. That’s a tightening of the pressure in the grain and protein markets for an indefinite period of time.”

Post Comment   Private Reply   Ignore Thread  

[Home]  [Headlines]  [Latest Articles]  [Latest Comments]  [Post]  [Mail]  [Sign-in]  [Setup]  [Help]  [Register] 

Please report web page problems, questions and comments to webmaster@libertysflame.com