Rising Food Prices

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Australia's floods may disrupt grain movement for weeks

* Domestic distribution network hit

* Major impact on stored grains unlikely

* US wheat futures climb more than 1 pct (Adds details, quotes)

Sun Jan 2, 2011 10:53pm EST

http://www.reuters.com/article/idUSL3E7C302K20110103

SINGAPORE, Jan 3 (Reuters) - Floods in Australia's Queensland could disrput grains supply for weeks, top grains handler GrainCorp Ltd said on Monday, further delaying the transportation to market of the country's waterlogged wheat crop.

Even ahead of the latest deluge, Australia's wettest spring on record had damaged the crop quality in the world's fourth largest wheat exporter, stoking supply concerns and pushing up global wheat prices. U.S. wheat futures Wc1 rose more than 1 percent in early Asian trade on Monday.

"We are unable to move anything by rail or, of course, road," David Ginns, corporate affairs manager at GrainCorp told Reuters, adding that transport of grain to port elevators from inland areas had effectively ceased, and the domestic distribution network had also been impacted.

Queensland floods have renewed concerns over wheat supplies, after large volumes of prime quality crop was damaged by rains at the end of 2010. The state would likely ccount for around 1 million tonnes, or about 5 percent of the country's total output this year, according to Ginns.

Crop analysis firm Australian Crop Forecasters expects a total harvest of 24.4 million tonnes, compared with 21.7 million tonnes last year. But it has predicted that 10 million tonnes of this would be downgraded from milling wheat to grains fit for animal feed in Australia, which typically produces little feed-quality wheat.

Chicago Board of Trade wheat posted its first yearly gain in three years, rising 47 percent in 2010, erasing the 42 percent combined loss for 2008 and 2009 when ample global supplies weighed on prices.

Prices started surging last summer after a drought in Russia and the Black Sea region decimated the crop there and shut off exports. In recent months, wet weather in Australia and dryness in U.S. wheat areas have raised fears over supplies.

Large parts of Australia's coastal northeast have disappeared under floodwaters in a spreading disaster that has brought some of the highest floods on record and forced thousands from their homes. [iD:nB98311]

Asked how long it would be before the situation returned to normal, Ginns said: "It is going to be a matter of weeks. You don't know what damage has occurred until water goes away and then you inspect."

"We can't move anything by rail, full stop," he said. "We have either got trains that are marooned out in western areas and cannot come to the coast, or trains that are on the coast and cannot go to the west."

Still, there was unlikely to be any major impact on stored grains, he said, as much of the grains in affected areas were stored in bunkers, surrounded by tarpaulins secured in "gas-tight" ways, which also rendered them fairly waterproof. (Reporting by Chris McCall, writing by Naveen Thukral; Editing by Himani Sarkar)

[mr me]

There were problems with Russia's harvest as well which caused them to halt grain exports. Canada's harvests are also down quite significantly to excess rain. Prices keep going up with more mouths to feed and developing nations having more wealth.

[bℓσωηG]

Personally i cant wait till we all become starving, zombie, heathens... maybe the smart ones will remember how to grow their own bloody food.

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All Evidence Points To A Dramatic Increase In Food Prices Worldwide, Possible Shortages

December 30, 2010 by Alex

http://theintelhub.com/2010/12/30/all-evid...ible-shortages/

For the last two weeks we have reported and researched the possibility of a food shortage due to a mixture of freezing temps, moves by our government that seem to hurt rather than help food prices, and hot, dry weather in the regions that haven’t froze.

Here are just a few of the hundreds of articles that have come out in the past month that point to rising food prices worldwide.

In Ireland, tens of thousands are without water due to freezing weather that has burst pipes throughout the country.

While Europe and the east coast of the United States have feel victim to numerous blizzards, South America is experiencing hot, dry weather that has rose fears that corn and soybean crops will be damaged.

“Dec. 27 (Bloomberg) — Corn may rise for a sixth straight week and soybeans may gain on speculation that hot, dry weather will damage crops in Brazil and Argentina, the two biggest exporters after the U.S.

Seventeen of 24 traders and analysts surveyed in the U.S. on Dec. 23 said corn will rise, and 19 of 25 respondents said soybeans will advance for the fifth time in six weeks. Last week, corn futures for March delivery climbed 2.9 percent to $6.14 a bushel on the Chicago Board of Trade. Soybean futures for March delivery rose 3.8 percent to $13.60 a bushel.”

In Colorado, lack of moisture is threatening wheat crops in what farmers have described as the worst they have seen in 30 years.

The Greeley Tribune

Farmers are survivors.

That’s why many will shrug off this year’s bad start to the winter wheat crop, still resting on the little bits of hope for moisture they keep alive.

“Now, it’s probably the worst we’ve seen in 30 years,” said Jim Cooksey of Cooksey Farms southeast of Roggen.

Four months of little to no moisture is taking its toll on the crop, which blankets fields across northern Colorado. That means hopes for even an average harvest next summer are starting to dwindle.

In London, wheat prices rose to match prices in France and United States. Dry weather in Argentina is also threatening corn and soybeans.

In Southern Florida, unusual freezing has destroyed many of the crops that were saved before the freeze that happened there two weeks ago. Governor Christ has extended his crop freeze emergency order.

The industry has already lost close to 273 million dollars since early Decemeber.

news-press.com

Whatever crops were salvaged following a freeze nearly two weeks ago, were done in by last night’s chilly temperatures, said Frank Oakes, the owner of Oakes Organic Farm and Food & Thought in Collier County.

“The frost this morning was thicker than I’ve seen it,” Oakes said after surveying his crops near the Corkscrew Swamp Sanctuary early this morning. “It looks like the ground is covered in snow.”

On December 28th, The New York Times published an article with the shocking title, “Global Food Prices in 2011 Face Perilous Rise.” The article explains how there is talk of a coming worldwide food crisis and that government must act to avoid a disaster.

New York Times

Food prices globally are rising to dangerous levels. There is talk of a coming crisis, like the ones that produced riots around the world in 2008 and 1974. Many of the ingredients of a disaster are present, but governments can stop the problem before it causes too much damage.

A warning sign is the price of traded staples like wheat, corn and rice. Prices shot up in 2010, soaring 26 percent from June to November and brushing the peaks of 2008, according to the Food Price Index kept by the Food and Agriculture Organization of the United Nations. That hits poor countries that import much of their food, including the Philippines, Mexico, Nigeria and Pakistan.

Floods have ravaged Queensland Australia and food prices are expected to rise by 50 percent. Upwards of 20% of crops have been destroyed.

Courier.com.au

The damage is likely to push up the cost of groceries including melons, tomatoes, mangoes, and bananas from Wednesday.

Affected farmers on Tuesday revealed both summer and winter crops had been destroyed, with many hectares of newly planted grains, vegetables and fruit submerged by flooding.

FOOD prices could rise as much as 50 per cent as the Queensland farming industry is hit with flooding losses of at least $400 million.

Prices are rising throughout the world and seem on track to continue to rise throughout 2011.

You Are Being Warned! Freezing Temps Worldwide May Lead To Food Shortages

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Global Food Prices in 2011 Face Perilous Rise

By JOHN FOLEY

Published: December 28, 2010

http://www.nytimes.com/2010/12/29/business...?_r=1&src=busln

Food prices globally are rising to dangerous levels. There is talk of a coming crisis, like the ones that produced riots around the world in 2008 and 1974. Many of the ingredients of a disaster are present, but governments can stop the problem before it causes too much damage.

A warning sign is the price of traded staples like wheat, corn and rice. Prices shot up in 2010, soaring 26 percent from June to November and brushing the peaks of 2008, according to the Food Price Index kept by the Food and Agriculture Organization of the United Nations. That hits poor countries that import much of their food, including the Philippines, Mexico, Nigeria and Pakistan.

High prices deprive the poor, who already spend as much as half of their income on food. The market still clears, but at a riot-inducing high price. In India, where the cost of onions has in the past led to the upending of governments, prices of the good have again skyrocketed.

For most big countries, food prices are a domestic affair. Just 12 percent of cereals produced are traded across borders. In countries that grow their own, like China, Russia and India, buyers often pay prices set by the government that have little link to global markets. Yet these nations are suffering, too.

China, which only really uses global markets for soybeans, is fretting over soaring shop prices for goods as diverse as pork and seaweed. In India, a fifth of the population is undernourished, according to the United Nations. Both countries have their own issues; for instance, in India, awful infrastructure means a third of produce spoils before it reaches the market. But something is clearly making the problem worse.

It isn’t shortages. True, demand for staple grains is predicted to rise 2 percent in 2011, even as production falls 4 percent. But grain reserves run to almost 17 percent of total use, according to Rabobank, which is about the level generally seen as a sensible buffer.

Nor are the main problems population trends or changing eating habits in developing markets. That extra demand may be making the world a bit more crisis-prone, but more productive, mechanized farming methods in China, India and Africa have potential to create some slack.

The main cause looks to be too much money. Governments have effectively printed the stuff to help their economies recover.

This has created two side effects. First, investors have bought exposure to commodities as an economic hedge. Second, the price of foodstuffs has been bid up as low interest rates reduce the opportunity cost of hoarding them — especially in China, where the money supply grew almost 20 percent in 2010.

Whether those high prices turn into a crisis depends on two things. First, there are short-sighted policy responses. Food producers often ban exports when they fear shortages or price spikes are coming.

Sometimes they are right to worry. Russia’s recent droughts have left it with a genuine wheat shortfall. And India has just banned the export of onions to address the latest flare-up.

But India also introduced a rice export ban in 2007 when it still had a sizable surplus, helping to double the world price. By 2008, more than 30 countries had some kind of controls in place. Export bans often cause bubbles abroad; they also stop farmers from benefiting from high prices that would get them growing more.

The second flash point is the price of oil. That increases transport costs for food. But it also encourages politicians to divert grains into biofuels, which become competitive when oil hits $60 a barrel.

The average oil price in 2011 is forecast at $84, according to a Reuters poll. The United States, which supplies two-thirds of the world’s corn exports, diverted huge amounts into biofuel in the run-up to the 2008 crisis, causing 70 percent of the rise in corn prices, according to the International Monetary Fund. That distortion was passed straight onto the world’s poor.

Food riots in 2011 are possible, but not inevitable. Granted, the world will have to get used to more food scares as the population expands and the diets of the poor get richer. But the moment when humanity outgrows the earth is thankfully not yet here. Cool-headed policies can still prevent a real crisis. JOHN FOLEY

[gogogadget]

Not to mention all the supermarket owners are pirates in their own rights, charging 75% - 100% profit on goods without us even knowing, i guess SWIM wont be making any wheat whisky until the prices drop again , SWIMS partners father owns a plantation up in Carnarvon which is also hit hard with severe flooding he lost his house also, all i can say is the insurance company's will be having a field day with all of this, their a pack of wolves, (shakes head)

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How Goldman Sachs Created the Food Crisis

Don't blame American appetites, rising oil prices, or genetically modified crops for rising food prices. Wall Street's at fault for the spiraling cost of food.