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Fears of new food crisis as prices soar

Re: Fears of new food crisis as prices soar

Source: http://www.cnn.com/2011/WORLD/europe/02/03/world.food.prices.rise/index.html?hpt=T2

World food prices hit record high
By Bryony Jones for CNN
February 3, 2011 8:25 a.m. EST

London (CNN) -- World food prices rose to an all-time high in January, according to the UN's Food and Agriculture Organization (FAO).

The FAO's Food Price Index measures the cost of a basket of basic food supplies -- sugar, cereals, dairy, oils and fats and meat -- across the globe.

The index rose by 3.4% in January -- the seventh monthly increase in a row -- to its highest level since records began in 1990...
 
Re: Fears of new food crisis as prices soar

FAO Initiative on Soaring Food Prices
By mid-2008, international food prices had skyrocketed to their highest level in 30 years. This, coupled with the global economic downturn, pushed millions more people into poverty and hunger.

In December 2010, the FAO food price index had risen above its 2008 peak, and in January 2011, it had increased by 3.4 percent. Food prices will likely remain volatile. Efforts need to be scaled up at all levels to strengthen the resilience of small farmers to future shocks and to improve food and nutrition security over the long term [more].
Click to expand...
http://www.fao.org/isfp/isfp-home/en/
 
Fears of new food crisis as prices soar

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?Statistics?: Rising meat prices in December increased by 28.7%, sugar 16.3%

Central Agency for Public Mobilization and Statistics, increase the rate of inflation during the month of December last year, reaching 10.3%, compared to 10.2% during the month of November the former.

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He attributed the device in a statement Monday, the high rate of inflation to increase prices of many goods and services, in the forefront of food and drink, which rose to 16% in the total governorates of Egypt.

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He pointed out that the increase in the prices of meat and poultry amounted to about 28.7%, cereals 21.5%, bread, sugar and sugary foods 16.3%, vegetables 11%, milk, cheese, eggs, fruit 8.8% and 4.9%.
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He pointed out that the price increases also included the departments of education, and smoke, restaurants, hotels, special item ready meals.
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For his part, Dr Samir Radwan, Advisor to the General Authority for Investment and a member of the People's Assembly, that an increase in food prices is the main engine to increase the rate of inflation, pointing out that the provision of food and drink consumed the bulk of the budget of families.
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Radwan and predicted in a statement ?Egyptian today?, a new wave of high food prices worldwide, including oil, margarine and sugar, which leads to increase the rate of inflation locally, adding to the adoption of a large part of domestic consumption on imports.
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On the possibility of the central bank to increase interest rates in the face of rising inflation, "Radwan said? It is difficult to predict this trend now ?, pointing out that the Central Bank's determination to maintain the fixed interest rates over the past months was the lack of justification for the increase.
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He called for tightening the control mechanisms of markets in the coming period, and the expansion of agricultural production.

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The Organization of the United Nations Food Organization (FAO) has indicated in a report last week, recording the prices of food to a record level last December, exceeding the 2008 levels, which saw the outbreak of riots in several countries.

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In a related development, confirmed Magda Kandil, Executive Director of the Egyptian Centre for Policy Studies, that the rate of inflation prevailing in Egypt, one of the highest rates among Egypt's trade partners, which negatively affects the competitiveness of exports and domestic production in the foreign market.


http://www.almasryalyoum.com/news/«الإحصاء»-ارتفاع-أسعار-اللحوم-في-ديسمبر-بنسبة-287-والسكر-163

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Re: Fears of new food crisis as prices soar

Source: http://www.marketwatch.com/story/corn-futures-surge-on-lower-forecast-2011-02-09

Feb. 9, 2011, 9:56 p.m. EST
Corn Pops as USDA Sees Drop in Supply
By Scott Kilman And Ian Berry

The outlook for global grain supplies and food prices grew more precarious Wednesday as the U.S. Agriculture Department said it expects U.S. corn supplies to fall to the near-record low level set 15 years ago.

Red-hot prices aren't cooling the appetite for U.S. grain as in the past, which means U.S. supplies are continuing to be drained at a rapid rate to make ethanol fuel, fatten livestock and meet demand overseas.

"We're just not seeing prices ration demand," said Luke Chandler, head of agricultural commodity markets research at Rabobank. "The markets have changed in a structural way due to ethanol. ... Any relief will take considerable time."

According to USDA projections released Wednesday, the 12.4 billion bushels of corn harvested by U.S. farmers last fall will dwindle to just 675 million bushels by Aug. 31, when a new harvest begins to replenish inventories...
 
Re: Fears of new food crisis as prices soar

Good thread Shiloh. Been waiting for this to come up

Graphically here is the price index and commodities price indices :

<a href="http://www.fao.org/worldfoodsituation/en/" target="_blank" onclick="if(!checkUrl(this.href)) return false;" rel="nofollow" >
<img src="http://www.fao.org/fileadmin/templates/worldfood/images/home_graph_1.jpg"> <img src="http://www.fao.org/fileadmin/templates/worldfood/images/home_graph_2.jpg"></a>
 
Re: Fears of new food crisis as prices soar

Ive mainly been focusing on the weather and climate related aspects of the food price situation. Certainly biofuel production and speculation will play into things. Here are some more stories:


<a href="http://www.guardian.co.uk/environment/2011/feb/07/crop-shortages-political-instability" target="_blank" onclick="if(!checkUrl(this.href)) return false;" rel="nofollow" >
<strong>
Failure to act on crop shortages fuelling political instability, experts warn</strong></a>

Food prices have hit record levels in recent weeks, according to the United Nations, and soaring prices for staples such as grains over the past few months are thought to have been one of the factors contributing to an explosive mix of popular unrest in Egypt and Tunisia.


<a href="http://news.xinhuanet.com/english2010/photo/2011-02/07/c_13721576_2.htm" onclick="if(!checkUrl(this.href)) return false;" rel="nofollow" target="_blank" ><strong>Henan's drought control authorities warn of further prolonged drought</strong></a>



<a href="http://news.xinhuanet.com/english2010/china/2011-02/08/c_13722789.htm" target="_blank" onclick="if(!checkUrl(this.href)) return false;" rel="nofollow" ><strong>East China wheat basket braces for worst drought in 200 years+</strong>

</a>JINAN, Feb. 8 (Xinhua) -- East China's Shandong Province, one of the country's major grain producers, is bracing for its worst drought in 200 years.


<a href="http://blogs.wsj.com/source/2011/02/01/when-russia-will-resume-grain-exports/" target="_blank" onclick="if(!checkUrl(this.href)) return false;" rel="nofollow" >When Will Russia Resume Grain Exports Again?</a>.

Russia stopped grain exports last summer after the worst drought to hit the country in over a century ravaged the countrys harvest and <strong>cut production by nearly 40%.</strong> The ban sent shockwaves through international markets and propelled wheat prices to highs not seen since the 2007-08 food crisis.


<a href="http://www.reuters.com/article/2011/02/08/srilanka-floods-rice-idUSSGE71704Q20110208" target="_blank" onclick="if(!checkUrl(this.href)) return false;" rel="nofollow" ><strong>UPDATE 2-S.Lanka says at least 35 pct of rice crop destroyed</strong></a>

Two rounds of flooding in Sri Lanka since January have destroyed at least 35 percent of the staple rice crop, the Agriculture Ministry said on Tuesday, raising the risk of food price inflation.


<a href="http://www.ft.com/cms/s/0/e51a4270-219a-11e0-9e3b-00144feab49a.html?ftcamp=rss#axzz1DTfoH8hr" target="_blank" onclick="if(!checkUrl(this.href)) return false;" rel="nofollow" ><strong>Indonesian crop failures add to food fears
</strong></a>


<a href="http://online.wsj.com/article/SB10001424052748704150104576122913248163514.html" target="_blank" onclick="if(!checkUrl(this.href)) return false;" rel="nofollow" ><strong>Australians Count Cost of Cyclone </strong></a>

"A huge area of <strong>the cane crop was completely flattened by the cyclone and they were already suffering a fair bit of impact from the torrential wet season,</strong>" said Dan Galligan, chief executive of Queensland Farmer's Federation, who estimated more than 500 million Australian dollars (US$507.1 million) of cane could be lost.
 
Re: Fears of new food crisis as prices soar

I didnt even see the story on laidback's link to the main FAO page. I knew south Africa suffered crop losses this year but evidentially so are other African nations:


FAO raises alert on high flooding risks in parts of southern Africa

Crops destroyed in Lesotho and Mozambique

In Lesotho, for example, one of the poorest countries in the sub-region, an FAO assessment team found that in some of the flooded areas up to 60 percent of harvests have been lost and over 4 700 livestock, mainly sheep and goats are dead.
 
Re: Fears of new food crisis as prices soar

In southern Brazil drought is an issue.

<a href="http://english.ruvr.ru/2011/02/09/43477035.html" target="_blank" onclick="if(!checkUrl(this.href)) return false;" rel="nofollow" >
<strong>Drought threatens Brazil farmers</strong></a>

Drought has killed corn and tobacco crops <strong>in rural areas where nearly 80 percent of farmers live</strong>.
 
Re: Fears of new food crisis as prices soar

Closer to the US unusual weather patterns and a sclerotinia fungus outbreak are affecting winter crops in and near North America:

Uncertainty ahead for romaine, iceberg

Prices on 24-count iceberg cartons from Yuma were $21.56-23.00 on Feb. 7, according to the U.S. Department of Agriculture. Just a week before they went for $12.50-13.55. Year-ago prices were about $6.


<a href="http://thepacker.com/UPDATED--Severe-Mexican-vegetable-shortages-expected-into-March/Article.aspx?oid=1306738&fid=PACKER-TOP-STORIES&aid=684" target="_blank" onclick="if(!checkUrl(this.href)) return false;" rel="nofollow" >UPDATED: Severe Mexican vegetable shortages expected into March</a>

On Feb. 8, the U.S. <strong>Department of Agriculture reported prices of $22.95-24.95</strong> for two-layer cartons of 4x4, 5x5 and 5x6 vine-ripe field-grown tomatoes from Mexico,<strong> up from $6.95-9.95 the week before and $5.95-7.95 the year before. </strong>
 
Re: Fears of new food crisis as prices soar

Rain in Saskatchewan, revolution in Egypt: How soaring food prices helped topple dictator

"The new figures clearly show that the upward pressure on world food prices is not abating," said FAO economist Abdolreza Abbassian. "These high prices are likely to persist in the months to come. High food prices are of major concern especially for low-income food deficit countries that may face problems in financing food imports and for poor households which spend a large share of their income on food."
 
Re: Fears of new food crisis as prices soar

Although arguably this crisis did not originate in biofuels I think its important to quantify the effect the biofuel industry has on surpluses and demand for grain. These price pressures exist even before low crop harvest events stress the food system and are also something new that needs to be considered.


One quarter of US grain crops fed to cars - not people, new figures show

One-quarter of all the maize and other grain crops grown in the US now ends up as biofuel in cars rather than being used to feed people, according to new analysis which suggests that the biofuel revolution launched by former President George Bush in 2007 is impacting on world food supplies.



This Washington post article glosses over many of the events of 2010 that led to shortages in supply - But it adequately frames the role of Biofuels in the final outcomes I believe.


How biofuels contribute to the food crisis

Today, the market is out of equilibrium. Biofuels have grown rapidly, from consuming 2 percent of world grain and virtually no vegetable oil in 2004 to more than 6.5 percent of grain and 8 percent of vegetable oil last year. Governments worldwide seek to triple production of biofuels by 2020, and that implies more moderately high prices after good growing years and soaring prices after bad ones.
 
Re: Fears of new food crisis as prices soar

Noticed the Algerian situation - looked back and it was unemployment and food prices there too it seems.

2 Killed, Hundreds Injured in Algerian Food Riots
January 08, 2011

Algerian state media says at least two people have been killed and 300 have been injured in rioting over soaring food prices.

Algeria shuts down internet as anti-government protests mount - Today - then:

Algeria Internet Not Shut Down, According To Renesys Analysis

Regardless its tense there.
 
Re: Fears of new food crisis as prices soar

Sysco declares force majeure, raises grocery prices

Jack H. Barnes, Confessions of a Macro Contrarian | Feb. 12, 2011, 1:29 PM

Food inflation driven by freezing weather in Florida during December and in Mexico during February, is hitting the US supermarkets in the coming day?s. Sysco sent out an alert that announced an ?Act of God?, to address their contracted supply issues.
 
Re: Fears of new food crisis as prices soar

Source: http://www.brecorder.com/news/agriculture-and-allied/world/1154641:news.html

Indonesia to boost rice stocks amid global food fears

JAKARTA (February 13, 2011) : Indonesia ordered hefty rice imports on Wednesday to boost stocks by a third in the latest sign that governments concerned about rising food prices and dwindling supplies are rushing into the market and could drive inflation even higher.

Global food prices have climbed to record highs on shrinking supplies of wheat, corn, soybean and oilseeds. While rice has been less of a worry thanks to ample supplies in the top two exporters, Thailand and Vietnam, traders said other Asian governments may soon seek to boost rice stocks too. Adding to gathering nervousness among governments over food supplies, China plans subsidies to boost grain output this year, state radio said in a report on its website...
 
Re: Fears of new food crisis as prices soar

Source: http://www.businessweek.com/ap/financialnews/D9LCJLU81.htm

The Associated Press
February 14, 2011, 9:23AM ET
China says drought in wheat belt 'grim'

BEIJING
Provinces in China's severely parched northeast have been ordered to step up emergency irrigation as part of a $1 billion effort to minimize the loss of crucial wheat crops.

China is the world's largest wheat-growing nation but its wheat belt has gotten virtually no precipitation since October. Expected shortages of the crop in China have already pushed up global prices for the commodity.
 
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