World must brace for higher food prices, experts say

Aug 19, 2012 by Severine Rouby
Rotting corn damaged by severe drought lies on the ground at a farm near Bruceville, Indiana. With drought parching farms in the United States and near the Black Sea, weak monsoon rains in India and insidious hunger in Africa's Sahel region, the world could be headed towards another food crisis, experts say.

With drought parching farms in the United States and near the Black Sea, weak monsoon rains in India and insidious hunger in Africa's Sahel region, the world could be headed towards another food crisis, experts say.

Asia should keep a catastrophe at bay with a strong rice harvest while the G20 group of industrialized and emerging economies tries to parry the main threat, soaring food prices.

"We have had quite a few this year that will lead to very poor harvests, notably in the United States with corn or in Russia with soja," warned Philippe Pinta of the French farmers federation FNSEA.

"That will create price pressures similar to what we saw in 2007-2008," he added in reference to the last global food alert, when wheat and rice prices nearly doubled.

In India, "all eyes will be on food inflation - whether the impact of a weak monsoon feeds into food prices," Samiran Chakraborty, regional head of research at Standard Chartered Bank was quoted by Dow Jones Newswires as saying.

were 15.2 percent below average in mid-August, according to latest data from India weather bureau, and Asian rice prices are forecast to rise by as much as 10 percent in the coming months as supplies tighten.

India and Thailand are two of Asia's leading rice exporters.

Indian Food Minister Kuruppasserry Varkey Thomas told parliament this month that prevailing conditions "could affect the crop prospects and may have an impact on prices of essential commodities."

Despite that warning however, the UN Food and Agricultural Organization expects rice output to slightly surpass "excellent results" recorded last year, though the FAO cut its global forecast for production of unmilled rice to about 725 million tons from its previous figure of 732 million.

The world is feeling the onset of the El Nino , which has a natural warming effect, is active in the western Pacific and expected to last until winter in the , according to Japanese meteorologists.

The US farm belt has been ravaged by the most stifling drought since the 1950s, and the country's contiguous 48 states have just sweltered through the hottest July on record.

Corn production is probably at the lowest level in six years, the US Department of Agriculture said, and curtailed production will likely send corn and soybean prices to record highs, it added.

"Cereal prices have shot up, with an increase in (corn) prices of almost 40 percent since June 1," strategists at the CM-CIC brokerage noted.

Commerzbank commodity experts said high temperatures and drought around the Black Sea "have resulted in wheat crop shortfalls on a scale that cannot yet be predicted with any accuracy."

US commodities analyst, AgResource Company president Dan Basse told the Australian Broadcasting Corporation last week that the Australian harvest could play a role in easing the food shortage.

"We need every metric tonne of wheat and grain the Australian farmers can produce," Basse said. "Anything that the Australian farmer can do to assure or boost his production should be profitable in the year ahead."

Jean-Rene Buisson, head of France's national association of food industries (ANIA) said: "All products based on cereals, including meat, will be affected by price increases, not necessarily by September, but definitely during 2013."

In China, food prices are considered politically sensitive and account for up to a third of a consumer's average monthly budget, government statistics show.

China has reined in inflation as its economy slows however, while its grain output stood at 1.3 trillion tonnes in the first half of the year, up 2.8 percent from the same period a year earlier.

The Financial Times (FT) said concerns over the US harvest had prompted senior G20 and United Nations officials to consider an emergency meeting on food supply, with a conference call on the issue scheduled for August 27.

The newspaper cited officials as saying the talks were not a sign of panic but rather reflected the need to establish a consensus to avoid a repeat of the riots and tensions sparked in 2007-08 by spiking food prices.

Major concerns include hoarding or export restrictions by food producing countries, along with panic buying by others.

Also crucial is the balance between the use of grain as a direct source of food and its role as animal feed or as a basis for motor fuels.

FAO director general Jose Graziano da Silva of Brazil called in the FT for the United States to suspend biofuel production programmes to ease the pressure on food resources.

"An immediate, temporary suspension" of a mandate to reserve some crops for biofuels "would give some respite to the market and allow more of the (corn) crop to be channelled towards food and feed uses," he wrote.

A region where food is in chronic shortage is the Sahel region of Africa, where the number of malnourished children is estimated to have hit a new high of 1.5 million as cholera and locusts emerge as new threats, UNICEF has warned.

The relief agency World Vision Australia said 18 million people need food assistance in Niger, Mali, Chad, Mauritania and Senegal.

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NotParker
1.9 / 5 (17) Aug 19, 2012
"The US farm belt has been ravaged by the most stifling drought since the 1950s"

Really. The 50s?

"Corn production is probably at the lowest level in six years"

I guess they meant 2006 .
Vendicar_Decarian
Aug 19, 2012
This comment has been removed by a moderator.
alfie_null
5 / 5 (3) Aug 19, 2012
"An immediate, temporary suspension" of a mandate to reserve some crops for biofuels "would give some respite to the market and allow more of the (corn) crop to be channelled towards food and feed uses," he wrote.

"Feed" meaning "to make more cows, chicken, etc."? I'm confused - is this (suspension of the mandate) to be done for humanitarian purposes, or to ensure a plentiful, cheap supply of meat for my table?

I note the quoted FAO director is from Brazil. I wonder if he feels the same about use of cane sugar?
ryggesogn2
2.2 / 5 (13) Aug 19, 2012
"In China, food prices are considered politically sensitive and account for up to a third of a consumer's average monthly budget, government statistics show."

Food budget in USA:

Component 191719 1950 196061 197273 198687 1998
Food 41.1 32.5 26.0 22.6 19.4 16

"A century of family budgets in the United States"

Keep the govts out of the way and food will be produced at prices people are willing to pay.

ryggesogn2
2.3 / 5 (12) Aug 19, 2012
"MITs models foresaw the collapse of civilization because of nonrenewable resource depletion and population growth. "
"The modelers missed something human ingenuity in discovering, extracting and innovating. Which did not just appear after 1972. "
http://www.washin...ory.html

Human ingenuity has been proven to be stifled by socialist, centrally planned economies.

gopher65
4.3 / 5 (6) Aug 19, 2012
Keep the govts out of the way and food will be produced at prices people are willing to pay.

Heh, that's funny. It's funny because the reason food is so cheap in the US compared to other countries (even Canada, which shares a common food market with the US, but sees prices between 30% higher and double those in the US) is because the US federal government provides MASSIVE subsidies to lower food prices.

The price you pay in an American supermarket is lower than what the food costs to produce, never mind shipping, marketing, etc.
Vendicar_Decarian
3 / 5 (6) Aug 19, 2012
Now ParkerTard confused drought severity with corn production.

His mental disease is terminal.
Vendicar_Decarian
2.6 / 5 (5) Aug 19, 2012
And now Ryggtard posts lottery numbers.

"Component 191719 1950 196061 197273 198687 1998
Food 41.1 32.5 26.0 22.6 19.4 16" - Ryggtard

Mindless.

ryggesogn2
1.7 / 5 (11) Aug 19, 2012
"Farm support programs tend to keep the inefficient farmers on the farm and to discourage their looking elsewhere for more useful employment.

The startling fact is that 7 per cent of our population now produces 90 per cent of our food and fiberan accomplishment certainly not attributable to the various farm programs with which agriculture recently has been blessed." FEN 1956
http://www.thefre...farming/
ryggesogn2
1.7 / 5 (11) Aug 19, 2012
"And yet while the people starve, Robert Mugabe - still clinging to power as their president - has ordered that the last of Zimbabwe's white, commercial farmers must leave their farms.

'It's crazy, and it's sad,' says Bryan Bronkhorst as we drive past his farm, which has recently been occupied by members of Mugabe's political party, Zanu PF. 'But it is the government's fault. We used to be the breadbasket of Africa.' "
http://www.dailym...ths.html
ryggesogn2
1.7 / 5 (11) Aug 19, 2012
"Brace yourself: this is free-market faith to make Adam Smith proud. But the New Zealand experience is pretty persuasive. Well into its second decade of subsidy-free farming, New Zealand enjoys a worldwide reputation for its high-quality, efficient and innovative agricultural systems. "
http://newfarm.ro...es.shtml
NotParker
2.2 / 5 (13) Aug 19, 2012
Now ParkerGenius confused drought severity with corn production.


The US was drier than normal ... 28th driest. Far from a record.

The problem was that the really dry parts in July were the corn belt.

Many states had normal or above average rainfall (white and green) :

http://sunshineho...if?w=700
rwinners
2.3 / 5 (6) Aug 19, 2012
How much corn will be used this year in the USA to produce ethanol?
Vendicar_Decarian
3 / 5 (6) Aug 19, 2012
Central planning and socialism are mutually exclusive.

"Human ingenuity has been proven to be stifled by socialist, centrally planned economies." - RyggTard

RyggTard can't even manage to figure that out for himself.

Vendicar_Decarian
3.4 / 5 (5) Aug 19, 2012
ParkerTard's latest lie is making the statment...

"Many states had normal or above average rainfall (white and green)"- ParkerTard

And then showing a map of precipitation which omits the months, of January, February, March, April, May, June, and August.

He must love the fact that the central U.S. is reverting back to desert as the globe warms.

Such is the nature of his mental disease.
Vendicar_Decarian
3 / 5 (4) Aug 19, 2012
Odd, every time I hear a Conservative talk about Adam Smith, they do so with hate filled prose.

"Brace yourself: this is free-market faith to make Adam Smith proud." - RyggTard

But when they have nothing to show except failure from their own economic policies, they quote Smith with abandon.

AlexCoe
1 / 5 (10) Aug 19, 2012
"We have had quite a few climate events this year that will lead to very poor harvests, notably in the United States with corn or in Russia with soja," warned Philippe Pinta of the French farmers federation FNSEA.

Excuse me, but they are WEATHER events NOT CLIMATE events.
....
http://www.nasa.g...her.html

What Climate Means
In short, climate is the description of the long-term pattern of weather in a particular area.

Some scientists define climate as the average weather for a particular region and time period, usually taken over 30-years. It's really an average pattern of weather for a particular region.
.....
Trying to convert corn to fuel is a waste of resouces, that it is done by mandate of the govt is just one more example of stupidity in those elected.
AlexCoe
1.4 / 5 (10) Aug 19, 2012
BTW VD the lottery numbers you refered to...
The Family Budget information is taken from Table 3, page 32 of http://www.bls.go...full.pdf

Years and percentage of family budget
1917-19 food was 41%
1950 - 32.5%
1960-61 - 26.0%
1972-73 - 22.6%
1986-87 - 19.4%
kochevnik
3.2 / 5 (10) Aug 19, 2012
@ryggesogn2 Keep the govts out of the way and food will be produced at prices people are willing to pay.
That's blatantly stupid. Cost of food production is only 3% of the cost at the supermarket. Food distribution is rifle with useless middlemen going after the money and literally taking the food out of your mouth.
ryggesogn2
1.4 / 5 (11) Aug 19, 2012
@ryggesogn2 Keep the govts out of the way and food will be produced at prices people are willing to pay.
That's blatantly stupid. Cost of food production is only 3% of the cost at the supermarket. Food distribution is rifle with useless middlemen going after the money and literally taking the food out of your mouth.

But govts subsidies the wrong crops or in the case of Zimbabwe, force productive farmers off the land.
Distribution is 'rife' with middle men? Like who? Competition is fierce and distribution in the US is quite open.
Now in corrupt countries that steal food aid, that is the fault of the failure of govts to protect private property.
The US military is investigating the use of heavy lift blimps to deliver supplies in remote areas. One of those 'remote' areas was Haiti after the earthquake. Food rotted on the docks as what poor roads they had were damaged.
How much food was wasted in USSR by central planers running the farms?
ryggesogn2
1.4 / 5 (10) Aug 19, 2012
"Over the weekend, the multi-billion dollar subsidy for ethanol expired. "
"Ironically, most people think that import tariffs have kept out the lower-cost Brazilian sugar cane ethanol. But Brazil's demand for ethanol has skyrocketed over the last few years, and their domestic supplies haven't been able to keep up. So, somewhat surprisingly, the U.S. has been supplying Brazil with ethanol. "
http://www.npr.or...ubsidies

Of course the EPA still mandates the use of ethanol in gasoline.

If the US began switching to CNG to power their cars, less ethanol, less oil and CNG is produced in the USA.
Honda has a car and home based fuel station to use your natural gas supply to fuel your car at night.

http://www.consum...ndex.htm
kochevnik
2.4 / 5 (9) Aug 19, 2012
Distribution is 'rife' with middle men? Like who? Competition is fierce and distribution in the US is quite open.
Oh with firms like Conagra and cargill, and landowners choking out the small farmer like Prudential Insurance. You're a complete fraud.
kellarlln
2.6 / 5 (5) Aug 19, 2012
and meanwhile, the Obama Administration is buying up billions of dollars in non-perishable food for "emergencies", keeping the supply away from the American people and driving up costs.
Vendicar_Decarian
5 / 5 (1) Aug 20, 2012
Very outdated RyggTard's last year was 1987, which is 25 year ago.

"The Family Budget information is taken from Table 3, page 32 of http://www.bls.go...full.pdf" - Alex

Now that peak Oil is here, and the Climate Instability is increasing due to global warming, food prices are on the increase.

http://www.econom...ce_index

As you can see, Oil price has been so far a good predictor of Food prices.

http://www.oilpri...1033.png

This is changing as the U.S. reverts to desert.
extinct
1 / 5 (6) Aug 20, 2012
a couple of quick thoughts:
1) what happened...? GMO's didn't deliver on their false promise to increase yield? all the more reason to ban them globally forever. anyone caught polluting billion-year-old germlines i.e. genetically modifying anything or any organism for any reason should have to spend 10 years in solitary confinement with no possibility of parole.
2) my money says that the so-called "experts" cited in the title and throughout the article are just well paid one-percenters who would go with whatever true or false agenda leads to their own self-preservation. the solution to any food shortage, past, present or future is simple: get off your arse and grow your own garden, with organic/heirloom seeds.
Deathclock
1.7 / 5 (6) Aug 20, 2012
Heh, that's funny. It's funny because the reason food is so cheap in the US compared to other countries is because the US federal government provides MASSIVE subsidies to lower food prices


...and where does the federal government get it's money?
gopher65
2.8 / 5 (4) Aug 20, 2012
extinct: So, you only eat natural foods? Like chicken? Beef? Broccoli? Carrots? Tomatoes? Rice? Wheat? Barley?

None of those are "natural". Virtually nothing that we eat (with the exception of heavily polluted seafood) is "natural". They are *all* foods that were created by humans using non-natural means over the past 13000 years. Some just in the past couple hundred.

The reason? Most plants (with the exception of a few types of seeds and fruits) don't want to be eaten. They don't purposefully make themselves healthy for us. In fact, they go out of their way not to be edible:P. I can sympathize; I do the same thing when encountering a predator. So we made things more edible. We changed them. We made them better for us.

Utilizing the naturalistic fallacy won't win an argument to the contrary.
extinct
1 / 5 (5) Aug 20, 2012
gopher65: you are injecting fear/uncertainty/doubt, where none previously existed, therefore your motives are questionable. in the past 13000 years as you put it, up until genetic engineering came along in the 20th century, nobody had ever spliced genes from one lifeform to another. people had used natural breeding techniques to steer their crops and farm animals in the direction of the desirable traits they wanted. genetically modifying just one gene in one organism leads to *thousands* of changes, only about one of which is desirable, i.e. the non-browning apple or whatever, but that same apple has thousands of undocumented detrimental changes not talked about by GMO peddlers, because if they did talk about them, nobody would buy their poison.
sorry, no apples-to-apples (pun fully intended) comparison can be made between the last 13000 natural years of farming and what greed-based windfall-profit-driven GM unnatural science is doing now.
gopher65
5 / 5 (1) Aug 21, 2012
Actually extinct, multi-species retroviri (including ones that can survive in both plants and animals) have been making modifications similar to those made in GMOs for billions of years:P. Most of the "junk" DNA in, for instance, a human is the result of such gene splicing.

Why is it ok for a nasty, harmful virus to engage in gene splicing, but wrong for us to do it on a much smaller scale, in a more controlled, well tested environment? Again, naturalistic fallacy.

Also, if you're worried about invasive species hurting nature... too late, and they aren't GMOs. We also didn't need genetic engineering to destroy ecosystems. That's already been done using a variety of other means.

One of the biggest flaws in the anti-GMO arguments is the assumption that GMOs will be worse for the environment than everything else that we've done. There is no evidence for this scifi movie assumption.