World food crisis

[Adios]

World food prices have hit their highest level on record in January, the United Nations has said.

It said on Thursday that its Food and Agriculture Organisation Food Price Index rose for the seventh month in a row to reach 231, topping the peak of 224.1 last seen in June 2008.

It is the highest level the index has reached since records began in 1990.

"The new figures clearly show that the upward pressure on world food prices is not abating. These high prices are likely to persist in the months to come," said Abdolreza Abbassian, an economist for FAO, which is based in Rome.

Rising food prices have been cited among the driving forces behind the recent popular revolts in north Africa, including the uprising in Egypt and the toppling of Tunisia's long-time president Zine El Abidine Ben Ali.

In response, some countries are increasing food imports and have built stockpiles to meet their domestic needs.

Among them is Algeria, wary after food riots in early January. It has made huge wheat purchases to avoid shortages, and on Thursday it announced plans to lift a 19-year-old state of emergency in
a bid to to avert spreading protests.
http://english.aljazeera.net/news/2011/0...91195.html

Hungry people are dangerous people. Add in the economic crisis, global population and government stockpiling the coming decade could be one of global restructuring.

[The Good Reverend Roger]

Too many people.

[Adios]

I agree.

[The Good Reverend Roger]

I agree.

All we have to do is increase the food supply by 200 quarts of wheat per minute, and the transportation infrastructure with it, until people decide to stop having more than 1 kid per adult.

It's easy.

[Adios]

I agree.

All we have to do is increase the food supply by 200 quarts of wheat per minute, and the transportation infrastructure with it, until people decide to stop having more than 1 kid per adult.

It's easy.

The reality of that horrible movie, ZPG.

[Cain]

Too many people.

Nope, nothing to do with it.

Food price increases are a result of speculation on the commodities futures market which are being funded by mass injections of cash into the US banking system by the Fed, the "QE2".  Certain banks, such as Goldman Sachs, Morgan Stanely and some others, are given special exemption from restrictions on speculating on key commodities, using loopholes originally introduced to aid those who actually produced said commodities.

Food prices first started to rise when Bernanke gave the go ahead for QE2.  The Fed are now discussing QE3, and the food prices are suddenly shooting up again.  Many currencies are pegged with the dollar, meaning US commodity price increases feed directly into their economies.

[The Good Reverend Roger]

Too many people.

Nope, nothing to do with it.

Food price increases are a result of speculation on the commodities futures market which are being funded by mass injections of cash into the US banking system by the Fed, the "QE2".  Certain banks, such as Goldman Sachs, Morgan Stanely and some others, are given special exemption from restrictions on speculating on key commodities, using loopholes originally introduced to aid those who actually produced said commodities.

Food prices first started to rise when Bernanke gave the go ahead for QE2.  The Fed are now discussing QE3, and the food prices are suddenly shooting up again.  Many currencies are pegged with the dollar, meaning US commodity price increases feed directly into their economies.

I gotta disagree just a bit, Cain.  The population of the world now exceeds 7 billion people.  A person requires a quart of wheat - or the equivalent - per day to survive, and we're adding 200 (net) people a minute.

That means we need 7 billion+ quarts of wheat per day.  There isn't any way to produce that much food without trashing arable land.  Sooner or later, demand outstrips capabilities...That might not be now, given what you've posted, but we can see it from here.

[Adios]

The problem is set to worsen after a massive snowstorm in the United States and floods in Australia. And economists warned that chaos in Egypt could push prices up further and foment more unrest in the region.

Sugar prices also have surged to three-decade highs on fears of the damage that Cyclone Yasi would bring to the Australian cane crop.

Prices for Malaysian palm oil, a cooking staple in the developing world, hit 3-year highs on flooding.

Big companies have had to adjust to higher raw material costs.


Reducing demand would help a lot though.

[The Good Reverend Roger]

Incidentally, that comes out to 2.6 trillion quarts of wheat (etc) per year, if the population stabilized this minute.

[Cain]

Too many people.

Nope, nothing to do with it.

Food price increases are a result of speculation on the commodities futures market which are being funded by mass injections of cash into the US banking system by the Fed, the "QE2".  Certain banks, such as Goldman Sachs, Morgan Stanely and some others, are given special exemption from restrictions on speculating on key commodities, using loopholes originally introduced to aid those who actually produced said commodities.

Food prices first started to rise when Bernanke gave the go ahead for QE2.  The Fed are now discussing QE3, and the food prices are suddenly shooting up again.  Many currencies are pegged with the dollar, meaning US commodity price increases feed directly into their economies.

I gotta disagree just a bit, Cain.  The population of the world now exceeds 7 billion people.  A person requires a quart of wheat - or the equivalent - per day to survive, and we're adding 200 (net) people a minute.

That means we need 7 billion+ quarts of wheat per day.  There isn't any way to produce that much food without trashing arable land.  Sooner or later, demand outstrips capabilities...That might not be now, given what you've posted, but we can see it from here.

And I have to disagree there.  Rice prices do not shoot up 10% in a single month due to "population growth".  Is population growth a long term factor?  Probably.  Is it causing near double digit prices rises on commodities like corn, pigs and cotton within a four week period?  I seriously doubt it.   This is speculation related.

The last time food prices rose so high was in 2008, and we know that was speculation driven, because the major banks were forced to admit it during the various Capitol Hill hearings their flunkies attended.  The EU and France have both blamed the current crisis directly on market based speculation as well

http://www.reuters.com/article/2011/02/04/uk-food-crisis-idUKTRE7132NZ20110204

[The Good Reverend Roger]

Too many people.

Nope, nothing to do with it.

Food price increases are a result of speculation on the commodities futures market which are being funded by mass injections of cash into the US banking system by the Fed, the "QE2".  Certain banks, such as Goldman Sachs, Morgan Stanely and some others, are given special exemption from restrictions on speculating on key commodities, using loopholes originally introduced to aid those who actually produced said commodities.

Food prices first started to rise when Bernanke gave the go ahead for QE2.  The Fed are now discussing QE3, and the food prices are suddenly shooting up again.  Many currencies are pegged with the dollar, meaning US commodity price increases feed directly into their economies.

I gotta disagree just a bit, Cain.  The population of the world now exceeds 7 billion people.  A person requires a quart of wheat - or the equivalent - per day to survive, and we're adding 200 (net) people a minute.

That means we need 7 billion+ quarts of wheat per day.  There isn't any way to produce that much food without trashing arable land.  Sooner or later, demand outstrips capabilities...That might not be now, given what you've posted, but we can see it from here.

And I have to disagree there.  Rice prices do not shoot up 10% in a single month due to "population growth".  Is population growth a long term factor?  Probably.  Is it causing near double digit prices rises on commodities like corn, pigs and cotton within a four week period?  I seriously doubt it.   This is speculation related.

The last time food prices rose so high was in 2008, and we know that was speculation driven, because the major banks were forced to admit it during the various Capitol Hill hearings their flunkies attended.  The EU and France have both blamed the current crisis directly on market based speculation as well

http://www.reuters.com/article/2011/02/04/uk-food-crisis-idUKTRE7132NZ20110204

It's not just the rise in demand, it's a hit in the ass on supply.  Here's a little nightmare fuel:

http://www.globalresearch.ca/index.php?context=va&aid=12252

Now, I'm NOT arguing the point that speculators are driving the crisis faster than necessary, and I don't doubt your information.  But even without the speculators, there's a really, really nasty series of events on the way.

[Cain]

In fact, just typing "food prices commodities speculation" into Google News will give you a wealth of articles on the topic.  Well over a thousand on just today's news about France, the FAO and the European Commission.

[The Good Reverend Roger]

In fact, just typing "food prices commodities speculation" into Google News will give you a wealth of articles on the topic.  Well over a thousand on just today's news about France, the FAO and the European Commission.

Sure.  Just like the bastards did with oil 2-3 times last decade.

Like I said, I don't doubt you a bit...But what the speculators are doing is advancing the problem, speeding it up...It's going to happen anyway.

Short term solution:  Feed the speculators to the Algerians.

[The Johnny]

Dialectical overcoming: too many people with some assholes speculating 

The "too many people" is the long-term slow rise while the "assholes speculating" is the short-term recent spike.

[Cramulus]

this is all very interesting. I'm still forming an opinion, & digging around for articles on food production. I came across this: http://fabiusmaximus.wordpress.com/2010/01/13/food-3/

The gist of the article is that no nations are at "peak food production" yet. The US's production rate has been climbing steadily. Corn yields, for example, have risen linearly (with no slowing) since WWII.

We are warned that if we hit peak food production, it would be very bad because the population will keep climbing while food production does not (duh). But the article suggests that we're still pretty far from there. There are many nations who are still using pretty old farming techniques, and could be producing quite a bit more food if they had the resources to do so. And the bright side is that the maximum potential yield keeps rising as we invent new technologies and better learn how to genetically engineer food.

it's all debatable though. There are some solid rebuttals in the comments.