usda covering up pending food shortage?

WND | While trend experts, economists and investment gurus have been predicting food shortages for some time, new evidence indicates the U.S. Department of Agriculture may be covering up the greatest food shortage in modern history.

Beginning in 2009, global agricultural markets faced a supply and demand imbalance, caused by a substantial drop in output resulting from the financial crisis and extreme weather around the world.

At the same time, growing economies in Asia have begun consuming record amounts of raw goods, particularly food staples as consumers move to higher protein, higher calorie diets. When supplies are reduced and demand is constant or growing, prices normally rise. Industry observers and economists remained mystified by the low agricultural prices in spite of this trend.

One analyst, Eric deCarbonnel from MarketSkeptics.com believes the answer is found in data he believes the U.S. Department of Agriculture has manipulated to keep food prices low. "Instead of adjusting production estimates down to reflect decreased production, [the USDA] adjusted estimates upwards to match increasing demand from China. In this way, the USDA has brought supply and demand back into balance (on paper) and temporarily delayed a rise in food prices by ensuring a catastrophe in 2010," he said.

DeCarbonnel points out that across the Midwest United States, many counties already have been declared federal disaster areas, which is defined by a decrease in crop production of at least one type by 30 percent or more. Hundreds of other counties across the country have experienced crop failures of 10-20 percent, not enough to qualify as federal disaster areas but still contributing to the overall poor harvest.

In some states, including Oklahoma, Louisiana, Arkansas and Alabama, the majority of counties have been declared disaster areas, and yet the USDA is predicting record harvests.

peak oil, climate change, food costs, debt - thai militarization a symptom of political system failure...,

guardian |  Military coups in Thailand are nothing new. But the latest seizure of power by army chief General Prayuth Chan-ocha underscores the risks to democracy when governments consistently fail to deal adequately with the complex convergence of systemic crises.

Although Chan-ocha has said he is merely seeking to "restore order" in reaction to escalating protests that have seen the deaths of 28 and injury of 700, informed observers point out that the declaration of martial law appears to have been calculated to benefit the coup instigators.

Whatever the case, the opportunity to impose authoritarian rule has emerged in the context of escalating political instability. But few recognise that the driving force of this instability is not simply 'political infighting', but the inexorable intersection of global trends that affect us all.

Three years ago, a prescient editorial in Thailand's English language daily, The Nation, noted that global economic growth was indelibly tied to the abundant availability of cheap oil. Pointing out the links between domestic oil scarcity in countries like Egypt beset with surging social upheaval, the editorial diagnosed the problem as follows:

"The recent sharp rise in food prices has triggered riots in Egypt and other less-developed countries. Higher energy prices have also added on to the inflationary pressure. The poor are the most vulnerable sector to fluctuations in food and energy prices. Governments thus have to come up with subsidy measures for food and energy."

What does this imply for Thailand? The editorial continued:

"The Thai inflation rate is very sensitive to higher oil prices, which will drive up local transport and production costs. As a heavy importer of energy, the rising oil price could derail the Thai economy and drain our reserves if we're not careful."

Indeed, Thailand is a net energy importer. As Southeast Asia's second-largest consumer of energy, with total domestic consumption at 108.7 million tonnes of oil equivalent (TOE), the slow demise of cheap energy sources exacerbated by rising demand from India and China has posed a growing challenge. 

Thailand's Ministry of Energy has not been entirely asleep at the wheel. In 2003, a government report acknowledged that the country's "high dependency on imported energy will make Thailand at risk of energy supply disruption and volatility of energy prices, apart from a substantial foreign currency loss for the imports of energy." The report urged the government to embark on a strategy to diversify energy supply sources and ramp up domestic renewable energy investment.

But the pace of transition has been too slow, with "little change to the status quo" - and so far the poor, especially rural farmers who have played an increasing role in recent protests, have been most affected. 

We need to call a spade a spade: Thailand's deteriorating economy is driven significantly by its fossil fuel dependence. In 2013, the International Energy Agency (IEA) warned that Thailand's economy was especially vulnerable to external shocks, disruptions to its energy supplies and oil price escalation. High international oil prices would push up the Consumer Price Index (CPI).

the new normal: revolt, migrate, or die...,

FinancialSense | This week wheat and soybeans are up 8 per cent and corn hit a record high of US$7.73 a bushel.

According to the U.S. Department of Agriculture (USDA) farmers in the US expect to plant one of the largest corn and soybean crops in history. Wheat production is up in China, Russia and the Ukraine - India is enjoying strong rice harvests. Growers in Brazil and Argentina have reaped bumper harvests. But production is barely keeping up with demand.

The USDA says inventories of corn and soybeans are plummeting. The supply of corn is at a 15-year low and soybean inventories are at record lows. Canola inventories are also down.

“World agricultural markets have become so finely balanced between supply and demand that local disruptions can have a major impact on the global prices of the affected commodities and then reverberate throughout the entire food chain.” A recent report from HSBC

Living on the edge - US grain production filled critical shortages in world supply three times in the last five years:

* 2007-08 drought hit Australian wheat
* 2009 drought hit Argentine soybeans
* 2010 drought hit Russian wheat

“This has been a demand-driven bull market. I do not think we can see a big enough increase in U.S. acreage to rebuild inventories back to a comfortable cushion in one year. It is going to take two years of good weather and good yields. There is absolutely no room for any weather problems anywhere in the world this year.” Jim Farrell, chief executive officer of Omaha-based Farmers National Co.

Good weather, and good yields for two years in a row just to get back to comfortable levels?

The International Monetary Fund (IMF) said, in a recent report:

“Over time, supply growth can be expected to respond to higher prices, as it has in previous decades, easing pressure on food markets, but this will take time counted in years, rather than months.”

It is estimated that the population of the world reached:

* One billion in 1804
* Two billion in 1927
* Three billion in 1960
* Four billion in 1974
* Five billion in 1987
* Six billion in 1999
* Projected to reach seven billion by early 2012
* Eight billion by 2030
* By 2050, the world's population is expected to reach around nine billion - minimum and maximum projections range from 7.4 billion to 10.6 billion
* By the mid 2060s it’s possible that 11.4 billion people will inhabit this planet

Over the next fifty years, as we add another 4.5 billion people to the world’s population, global demand for food will increase almost 70% if population growth predictions are correct.
Already approximately 1 billion people go to bed hungry each night. Somewhere in the world someone starves to death every 3.6 seconds - most are children under the age of five.

“Rising food prices are a threat to global growth and social stability and the world is just one poor harvest away from chaos.” Robert Zoellick, president of the World Bank

We have to realize that higher food prices and the resulting civil unrest are not a temporary condition but a New Normal and adjust ourselves accordingly.

Is a New Normal, the coming Harsh Times, on your radar screen?

pricier gas and food pinch consumers

Video - The demolition work's almost 75% done now. The price of a gallon of gas at the adjacent Mobil station has gone up 10 cents a gallon since Friday. Horse and buggy, anyone?

DailyFinance | Americans are paying more for food and gas, a trend that threatens to slow the economy at a crucial time.

So far, the spike in such necessities hasn't stopped businesses from stepping up hiring or slowed factory production, which rose in March for the ninth straight month. Still, higher gas prices have led some economists to lower their forecasts for growth for the January-March quarter.

Consumer prices rose 0.5 percent last month, the Labor Department said Friday. Nearly all of the gains came from pricier gas and food.

When taking out those two volatile categories, core inflation was relatively flat. But at the same time, employees are only seeing small, if any, pay increases.

"People have less money to spend on goods other than food and energy and that is going to cause the expansion to slow," said economist Joel Naroff of Naroff Economic Advisors.

The spike in prices is hitting most Americans just as the economy is gaining momentum. Businesses added more than 200,000 jobs in March and February, the best two-month hiring stretch in four years. And the unemployment rate has fallen to a two-year low of 8.8 percent.

Consumers also have a little more money to spend this year, thanks to a one-year cut in Social Security taxes.

But most of the extra $1,000 to $2,000 per person is filling the gas tank. The national average for a gallon was $3.82 on Friday — nearly $1 more than a year ago. In five states, the average price is exceeding $4 a gallon.

How big the economic impact will be is the critical question. Many analysts expect food prices will come down and oil prices will stabilize by summer. If companies continue to create jobs, consumer spending will rise faster. That would give the economy a boost by fall.

U.S. manufacturers are seeing more business, according to a separate report on Friday from the Federal Reserve. Factory output rose in March, bolstered in part by a jump in auto production.

One concern is automakers are bracing for some disruptions in the supply of parts from Japan, which is recovering from a 9.0-magnitude earthquake and tsunami that caused widespread damage.

Nigel Gault, chief U.S. economist at IHS Global Insight, predicts the economy will grow only 1.8 percent in the January-March period, down from an earlier estimate of above 3 percent. Rising inflation will likely cut consumer spending growth to half its pace in the previous quarter.

the beginning of the beginning of the end...,

Video - Someone at IEA leaked SPR release announcement

Utilipoint | I'm not one for conspiracy theories, but …

On June 23rd, 2011 the International Energy Agency (IEA) made a significant announcement. For just the third time in its history, it announced the release of oil from strategic reserves — some 60 million BBLs over the preceding month. The announcement pointed to the Libyan situation, where it estimated some 132 million BBLs of light, sweet crude oil had been removed from the market by the end of May, 2011 and noting that greater supply tightness (and the resulting run in up in prices) could threaten the fragile global recovery. The impact of this "shock" announcement was pretty immediate as crude prices fell with Brent Futures falling close to 7.5 percent in the immediate aftermath.

Reuters analyst, John Kemp1, immediately saw the move as targeted against speculators in the market. A view echoed by many U.S. newspapers which ran ugly headlines proclaiming the end of speculation in the market and a return to "fundamentals" and saner prices. If this unheralded and hugely coordinated and difficult decision by the IEA was targeted at speculators, it failed. The sudden unexpected downwards move did hit long biased hedge funds for sure—that can be seen in some rather disappointing returns for May from many managers, but was it even an effective "warning shot" as The Street2 put it? Was it a warning shot at all?

Strangely enough, oil prices were declining prior to the announcement and there was much speculation that the IEA move wasn't as much as a surprise as initially thought. According to one oil-trader, Mark Fisher, it wasn't and he made his accusation on CNBC."This information, in my opinion for what it's worth, was leaked. It was leaked," he rasped. "Somebody knew something." It wouldn't be too much of a surprise if the decision, which not only required agreement of IEA members but likely consultations with OPEC and others, was leaked as crude was down by four percent already.

What is clear is that the IEA's move was a direct market intervention, and yes, it was very much a speculative move by big governments to try to control what should be a free market. So who is crying foul now? After the announcement, the idea that another move by the IEA to keep down prices may be on the table was also mooted. But there is a problem with that strategy—the IEA simply doesn't have enough credible political capability to keep adding from the strategic reserve to the global oil supply. In a matter of months its reserves would be gone and the price of oil would still be close to record highs. As Fisher puts it—it's a risky gamble that the IEA can't win.

Central to this issue is this: the price is where it is at because of fundamentals, not speculators. I have argued this many times before. "To me, price volatility cannot be significantly dampened by reducing the ability of investors to "speculate" nor can it be addressed by greater market oversight and regulation (not that this may not be required for other reasons). It can only be addressed by recognizing and understanding the fact that for now, and the future, we are truly in a supply constrained world and that demands a higher level of thinking, a more strategic set of thinking and strategies at both the national and trans national levels,"4 I stated back in 2009. Even the IEA announcement points to fundamentals as its raison d'etre with its statement about Libyan oil. But hold on … 60 million BBLs to replace 132 million BBLs already lost from the market? Two million BBLs/day for 30 days to replace 1.5 million BBLs per day of lost Libyan oil? No wonder the speculators barely flinched.

The real reason for the release may be indeterminable. Some suggest President Obama has an eye on re-election and sees lower gas prices at the pump as a way to sweeten his chances. Others might suggest the move was really aimed at OPEC, the other speculators in the oil market, but the ones who really can impact prices. The fact is that it is irrelevant. What is relevant today, three years after my last article on this topic, is that nothing much worthwhile has been done to address the underlying issues of supply and demand. The United States still doesn't have an energy policy worth squat, and neither do many other Western economies. In fact, to me, it seems like only China has a practical energy/commodity policy these days—spend worthless T-bills on buying reserves in the ground anywhere you can—and fast.

But since 2009, the situation truly has gotten much worse. The population of this planet grew in those three years to 6.7 billion (by more than three times the population of Germany) and is set to rise to around 10 billion by 2050. Those extra people and their demands for food, energy and raw materials of every kind is the problem. In fact, policy decisions across the board have been counterproductive and counterintuitive. For example, The World Trade Organization changed its rules on subsidies, meaning that rather than buy and stockpile produce from farmers building reserves, governments pay subsidies without buying any of the produce. The impact of that move? No reserves to protect against volatility when some crisis arises. Another example is the move to biofuels again driven by government subsidies&3151that means farmers are turning arable farmland into corn or other ethanol making materials rather than grow food people can actually eat.

Through all of 2011, the cost of food has sat at record levels as measured by FAO price index5. I don't see any inkling of a sign that that situation will improve in the medium to longer-term., which brings me back to the title of this article, "The Beginning of the Beginning of the End." To me, the move by the IEA signals the beginning of the beginning of the end of the life we know. Something has to change and fast, but no one seems willing to tackle the issue. Boris Johnson, Lord Mayor of London, said it better than I back in 2007, "How the hell can we witter on about tackling global warming, and reducing consumption, when we are continuing to add so relentlessly to the number of consumers? The answer is politics, and political cowardice."6 "The debate is surely now unavoidable. Look at food prices, driven ever higher by population growth in India and China. Look at the insatiable Chinese desire for meat, which has pushed the cost of feed so high that Vladimir Putin has been obliged to institute price controls in the doomed fashion of Diocletian or Edward Heath," he states further in his article. Before concluding, he writes, "It is time we had a grown-up discussion about the optimum quantity of human beings in this country and on this planet.” Amen to that.

what's your gameplan as corn prices skyrocket?

TheContraryFarmer | Forgive me for returning to this topic again, but history is being made in the corn market and the mainstream press isn’t paying attention. Corn prices hit an all time high last week. As you pull on your boots and head for the garden or fields for spring planting, what are your plans? Are you ready for some seismic changes in food prices? Do you feel too helpless to do anything much but keep on hoeing? Am I overreacting?

Corn recently made it well into the $7.00 plus per bushel range, to an historic high, and a rise of about a dollar a bushel from the week before, indicating how eradicate the market has become. As I write this, the market is bobbing up and down around $7.50 like a basketball during March Madness. The USDA just came out with a report in which it said, much to the surprise of nearly everyone, that corn stocks remain unchanged. But then the experts came on with a litany of “it depends” about how one should interpret the meaning of “unchanged.”

We’ve heard for months now that corn was in short supply. There are a number of reasons, supposedly. The demand for ethanol was going up, supposedly. The ethanol plants were buying more corn, supposedly. Other countries were importing more corn, supposedly. Weather outlooks are iffy, supposedly. I can write more sentences ending with the word ‘supposedly’, but what’s the use. Even the grain traders are saying they don’t know what’s happening.

You can read all this stuff in the farm news yourself. I don’t really care to hear any more ‘supposedlies’. I just want to know the what of it, not the how or why. At the livestock auctions in eastern Ohio last week, buyers and sellers were talking glibly of ten dollar corn by this summer, lamb prices over four dollars, and heaven help the cattle market. If you happen to be raising your own calves for meat right now, you could not have a better investment IF you aren’t feeding them seven dollar corn.

Others at the auctions were convinced there is going to be crash. Even farmers who still have last year’s corn to sell (not many), looked at me and said: “this is not good.”

The National Corn Growers Association and food wholesalers and retailers are at each other’s throats over the way ethanol appears to be driving up the price of food. The chairman of Nestle’s has been particularly strident in his criticism, really ripping the corn growers and the ethanol suppliers and especially the government’s generous subsidies to the ethanol plants, insisting that the world needs all its tillable land for human food, not car fuel. I think he’s right, but the corn growers are lashing right back, declaring that the food industry’s attacks are inaccurate, unwarranted, etc. etc.

This much I know from history. During the Irish famine, the landlord farmers of Ireland continued to sell their oats to England where they could get a better price for it than from the starving Irish, until the government stopped them. I am way too pessimistic to think that could not happen again. There are plenty of people who would choose to use corn to feed their cars, boats and airplanes rather than starving people. Fist tap Dale.

is the world producing enough food?

NYTimes | Food inflation has returned for many of the same old reasons: the demand for meat has returned with the recovery of middle-income economies; the price of oil is up, which both raises the cost of food production and transport, and stokes the diversion of food crops into biofuel production. Speculators are taking pounds of flesh in the commodity exchanges. And, of course, freak weather has disrupted production in key export zones.

But what makes the weather matter? This is hardly the first La Niña weather cycle, after all. Every human civilization has understood the need to plan for climate’s vicissitudes. Over the centuries, societies developed the tools of grain stores, crop diversification and "moral economies" to guarantee the poor access to food in times of crisis.

Global economic liberalization discarded these buffers in favor of lean lines of trade. Safety nets and storage became inefficient and redundant – if crops failed in one part of the world, the market would always provide from another.

Climate change turns this thinking on its head. A shock in one corner of the world now ripples to every other. The economic architecture that promised efficiency has instead made us all more vulnerable. Little has changed in this crucial respect since the last food crisis. But this isn’t simply a rerun of 2008.
food protest in JordanMuhammad Hamed/Reuters Rising food prices caused protests in Karak, Jordan, in January.

While the global recession has turned a corner for some people in some countries, unemployment remains stubbornly high for many, and hunger has trailed it. There are 75 million people more undernourished now than in 2008. At the same time, governments are cutting back on entitlement programs for the poor as part of austerity drives to fight inflation.

Urban families are unable to afford food and fuel, and governments are unresponsive to their plight. Under such circumstances, as Egyptians know too well, food prices and climate change are revolution’s kindling.

Food Crunch

"The greatest challenge to the world is not US$100 oil - it's getting enough food so that the new middle class can eat the way our middle class does, and that means we've got to expand food output dramatically" - [CN - dopamine is one helluva drug.....,]

Full story in the Financial Post

The impact of tighter food supply is already evident in raw food prices, which have risen 22% in the past year.

At the centre of the imminent food catastrophe is corn -- the main staple of the ethanol industry. The price of corn has risen about 44% over the past 15 months, closing at US$4.66 a bushel on the CBOT yesterday -- its best finish since June 1996.

This not only impacts the price of food products made using grains, but also the price of meat, with feed prices for livestock also increasing.

"You're going to have real problems in countries that are food short, because we're already getting embargoes on food exports from countries, who were trying desperately to sell their stuff before, but now they're embargoing exports," he said, citing Russia and India as examples.

"Those who have food are going to have a big edge."

With 54% of the world's corn supply grown in America's mid-west, the U.S. is one of those countries with an edge.

Warsocialism and the Price of Oil

Oil Wars - Not only are the raging wars in the Middle East responsible for energy price inflation, they are also responsible for price inflation of many other commodities, especially grains and other foodstuff, whose production and transportation depend on fuel. According to the World Bank, food prices have more than doubled over the past three years. The price of rice, the staple for billions of Asians, is up 147% over the past year alone. The mounting food prices have caused hunger and deadly violence in many countries, including Haiti, Egypt, Thailand, Indonesia, Senegal, and Malaysia.[...]

Neoconservative forces in and around the Bush administration and beneficiaries of war dividends—wishing to deflect attention away from war as the main culprit for the skyrocketing energy prices—tend to blame secondary or marginally relevant factors: OPEC, China and India for their increased demand for energy, or supply-demand imbalances in global markets.[...]

It is not surprising, then, that many elected officials with input or voting power in the process of the appropriation of the Pentagon budget find themselves in the pocket of defense contractors. Neither is it surprising that these dubious relationships should serve as breeding grounds for the near legendary levels of waste, inefficiency, and corruption that surround the military-industrial-congressional complex.

Two major conclusions follow from this discussion. The first is that, as pointed out earlier, war and political instability in the Middle East are the major driving forces behind the soaring price of oil; and that, therefore, to contain or reverse the rising trend of energy prices requires bringing U.S. troops home. The second conclusion is that achievement of this goal, the goal of ending U.S. wars of aggression, is possible only if (a) money or profits are taken out of war, and (b) money is taken out of elections.

Biden Administration Solely Responsible For Pending Thanksgiving Hell...,

thehill |  Annually, millions of passengers travel by plane to see family for Thanksgiving; in 2019, 26 million travelers and crew passed through U.S. airport screening in the 11-day period around the holiday. This year, waves of Americans could see their flights canceled or delayed because of a severe lack of workers within the Transportation Security Administration (TSA). In June the agency warned of serious staffing shortages at nearly 150 of the nation’s airports. The situation was so bad that TSA office employees were asked to volunteer at airports for up to 45 days. 

Given these existing issues, the timing of President Biden’s Nov. 22 vaccine mandate for federal employees — just three days before Thanksgiving — could not be worse. As of October, only about 60 percent of TSA workers were vaccinated. If employees call in sick or organize a walkout days before the holiday, it would create a nationwide travel nightmare for potentially hundreds of thousands of people, leading to massive delays and waves of flights being canceled. President Biden could get stuck with a Reagan-air traffic controllers situation.

It is not just the TSA that is impacted by staffing shortages — airlines face similar challenges. The past few months have seen airlines such as Southwest and American cancel thousands of flights because of a shortage of workers; the latter is attempting to make due with just three-quarters of its pre-pandemic staff. The coming vaccine mandate for large private companies will make existing staffing issues that much more acute at a time when the airlines have no spare capacity, and it could spark a flood of resignations and layoffs. While most large airline workforces are mostly vaccinated — United reports more than 90 percent — even losing a small fraction of employees during the busiest travel period of the year would be disastrous. How many pilots will simply cash in their retirements instead of dealing with a sweeping federal mandate? How many mechanics or support staff will call in for a week or just quit?

Those who travel by car to see family this Thanksgiving will face burdens, as well. The cost of fuel is nearing an all-time high, impeding the ability for average families to drive long distances to see their loved ones. The increasing price of fuel (crude oil is anticipated at $120 next year) also leads to higher plane ticket costs and will drive up the price of most consumer goods and food. Plus, heating the family home will be much pricier.

Americans already are being pushed to the brink with inflated costs across the board. Food prices are at their highest point since the 1970s and global food prices increased 3 percent during just the month of October. Simultaneously, a worsening fertilizer shortage because of supply chain disruptions threatens to spike food costs even more. Prices are inflating across the board — a whole turkey doubled in price over the past two years. The New York Times said that 2021 could be the costliest Thanksgiving in history.

what's behind rising crude oil and food prices

Video - Go to 32.5 minutes into this video to see commentary on the cartel, on the record.

MarketOracle | “Approximately 60 to 70 percent of the oil contracts in the futures markets are now held by speculative entities. Not by companies that need oil, not by the airlines, not by the oil companies. But by investors who profit money from their speculative positions.”

“It’s a scam folks, it’s nothing but a huge scam and it’s destroying the US economy as well as the entire global economy but no one complains because they are ‘only’ stealing about $1.50 per gallon from each individual person in the industrialized world.”

“It’s the top 0.01% robbing the next 39.99% – the bottom 60% can’t afford cars anyway (they just starve quietly to death, as food prices climb on fuel costs). If someone breaks into your car and steals a $500 stereo, you go to the police, but if someone charges you an extra $30 every time you fill up your tank 50 times a year ($1,500) you shut up and pay your bill. Great system, right?”

“The great thing about the NYMEX is that the traders don’t have to take delivery on their contracts, they can simply pay to roll them over to the next settlement price, even if no one is actually buying the barrels. That’s how we have developed a massive glut of 677 Million barrels worth of contracts in the front four months on the NYMEX and, come rollover day – that will be the amount of barrels "on order" for the front 3 months, unless a lot barrels get dumped at market prices fast.”

“Keep in mind that the entire United States uses ‘just’ 18M barrels of oil a day, so 677M barrels is a 37-day supply of oil. But, we also make 9M barrels of our own oil and import ‘just’ 9M barrels per day, and 5M barrels of that is from Canada and Mexico who, last I heard, aren’t even having revolutions. So, ignoring North Sea oil Brazil and Venezuela and lumping Africa in with OPEC, we are importing 3Mbd from unreliable sources and there is a 225-day supply under contract for delivery at the current price or cheaper plus we have a Strategic Petroleum Reserve that holds another 727 Million barrels (full) plus 370M barrels of commercial storage in the US (also full) which is another 365.6 days of marginal oil already here in storage in addition to the 225 days under contract for delivery. “

These contracts for oil outnumber their actual delivery, a sign of speculation and market manipulation, as oil companies win government authorizations for wells but then don’t open them for exploration or exploitation. It’s all a game of manipulating oil supply to keep prices up. And no one seems to be regulating it.

What Phil sees is a giant but intricate game of market manipulation and rigging by a cartel—not just an industry—that actually has loaded tankers criss-crossing the oceans but only landing when the price is right.

“There is nothing that the conga-line of tankers between here and OPEC would like to do more than unload an extra 277 Million barrels of crude at $112.79 per barrel (Friday’s close on open contracts and price) but, unfortunately, as I mentioned last week, Cushing, Oklahoma (Where oil is stored) is already packed to the gills with oil and can only handle 45M barrels if it started out empty so it is, very simply, physically impossible for those barrels to be delivered. This did not, however, stop 287M barrels worth of May contracts from trading on Friday and GAINING $2.49 on the day. “

He asks, “Who is buying 287,494 contracts (1,000 barrels per contract) for May delivery that can’t possibly be delivered for $2.49 more than they were priced the day before? These are the kind of questions that you would think regulators would be asking – if we had any.”

u.n.: small-scale farming could double the world's food production

Slashfood | The United Nations released a whopper of a report today. In the midst of soaring global food and oil prices, the agency let loose a public stunner: World hunger and climate change cannot be solved with industrial farming. So much for seed-giant Pioneer Hi-Bred's "We Feed The World" slogan. Yowch.

The U.N. study makes it clear -- small-scale farmers can double food production in 10-years by using simple farming methods. According the The Guardian, insect-trapping plants in Kenya or weed-eating ducks in Bangladesh's rice paddies may be the way to feed the world's burgeoning population.

"To feed 9 billion people in 2050, we urgently need to adopt the most efficient farming techniques available. Today's scientific evidence demonstrates that agroecological methods outperform the use of chemical fertilizers in boosting food production in regions where the hungry live," says Olivier De Schutter, U.N. Special Rapporteur on the right to food and author of the report.

De Schutter told the Wall Street Journal that promoting natural farming techniques is the only sustainable way to guard against future food crisis.

"We set up our farming techniques in the 1920s when we thought there would be a never-ending supply of cheap oil," he said. "Developing farming in a way which makes it less addicted to fossil energy is much more promising."

For more global stories that affect us all, check out the AOL News United Nations site.


The agroecological methods mentioned throughout the report sure sound like organic farming to us, but ag writer Jill Richards says there are subtle differences separating the two terms. Agroecology increases soil quality, biodiversity and can make farms more resilient to climate change, but it also values indigenous farming methods, she says.

"A net global increase in food production alone will not guarantee the end of hunger (as the poor cannot access food even when it is available), and increase in productivity for poor farmers will make a dent in global hunger. Potentially, gains in productivity by smallholder farmers will provide an income to farmers as well, if they grow a surplus of food that they can sell," she writes.

So are we on the verge of an agricultural sea change? asks WSJ reporter Caroline Henshaw.

"As leaders debate how to combat record food prices and producers struggle to meet rapidly growing demand, the world is looking for a new agricultural revolution," Henshaw writes.

We think today's U.N. report might give that revolution the mighty shove it needs.

breadbasket running dry?

naturalnews | It's the largest underground freshwater supply in the world, stretching from South Dakota all the way to Texas. It's underneath most of Nebraska's farmlands, and it provides crucial water resources for farming in Colorado, Kansas, Oklahoma and even New Mexico. It's called the Ogallala Aquifer, and it is being pumped dry.

Without the Ogallala Aquifer, America's heartland food production collapses. No water means no irrigation for the corn, wheat, alfalfa and other crops grown across these states to feed people and animals. And each year, the Ogallala Aquifer drops another few inches as it is literally being sucked dry by the tens of thousands of agricultural wells that tap into it across the heartland of America.

This problem with all this is that the Ogallala Aquifer isn't being recharged in any significant way from rainfall or rivers. This is so-called "fossil water" because once you use it, it's gone. And it's disappearing now faster than ever.

The end of cheap food in America?
It's a sobering thought, really: That "America's breadbasket" is on a collision course with the inevitable. A large percentage of the food produced in the United States is, of course, grown on farmlands irrigated from the Ogallala. For hundreds of years, it has been a source of "cheap water," making farming economically feasible and keeping food prices down. Combined with the available of cheap fossil fuels over the last century (necessary to drive the tractors that work the fields), food production has skyrocketed in North America. This has led to a population explosion, too. Where food is cheap and plentiful, populations readily expand.

It only follows that when food becomes scarce or expensive (putting it out of reach of average income earners), populations will fall. There's only so much food to go around, after all. And after the Ogallala runs dry, America's food production will plummet. Starvation will become the new American landscape for those who cannot afford the sky-high prices for food.

lester brown on rising temperatures and rising food prices

climateprogress.org | It’s not news that Lester Brown is warning about our unsustainable approach to feeding the planet. But it is news that Scientific American has run a major article by him on how “The biggest threat to global stability is the potential for food crises in poor countries to cause government collapse.”

Brown’s “Key Concepts”:

* Food scarcity and the resulting higher food prices are pushing poor countries into chaos.
* Such “failed states” can export disease, terrorism, illicit drugs, weapons and refugees.
* Water shortages, soil losses and rising temperatures from global warming are placing severe limits on food production.
* Without massive and rapid intervention to address these three environmental factors, the author argues, a series of government collapses could threaten the world order.

Brown’s warnings, ignored for too long, are now being repeated at the highest levels. For instance, I previously blogged on the UK government’s chief scientist, Professor John Beddington, who laid out something very close to this collapse scenario in his speech yesterday to the government’s Sustainable Development UK conference in Westminster (see “When the global Ponzi scheme collapses (circa 2030), the only jobs left will be green“):

You can see the catastrophic decline in those [food] reserves, over the last five years or so, indicates that we actually have a problem; we’re not growing enough food, we’re not able to put stuff into the reserves….

I am going to look at 2030 because that’s when a whole series of events come together….

I will leave you with some key questions. Can nine billion people be fed? Can we cope with the demands in the future on water? Can we provide enough energy? Can we do it, all that, while mitigating and adapting to climate change? And can we do all that in 21 years time? That’s when these things are going to start hitting in a really big way. We need to act now. We need investment in science and technology, and all the other ways of treating very seriously these major problems. 2030 is not very far away.

selling food that has passed its expiration date...,

An estimated 40 percent of food in the United States ends up getting wasted and thrown away. Doug Rauch, who used to be the president of Trader Joe's, has come up with a way that might prevent some of that food from going to waste.

An estimated 40 percent of food in the United States ends up getting wasted and thrown away.
Doug Rauch, who used to be the president of Trader Joe's, has come up with a way that might prevent some of that food from going to waste.

Rauch's project is a market called the Daily Table, which is set to open next year in Dorchester, Massachusetts.

Most food that gets thrown out at the grocery store has passed the sell by date, which can sometimes be inaccurate depending on how the product is stored.

Also, farmers dispose of produce that has cosmetic abnormalities, because they won't be able to sell it.

The Daily Table will use that produce in prepared fresh food, to be sold at affordable prices.

Rauch is quoted as saying: "It's kind of a hybrid between a grocery store and a restaurant... it's going to take this food in, prep it, cook it... But the idea is to offer this at prices that compete with fast food."

The market will not only conserve food that would otherwise go to waste, but they can also sell that food at a discount.

rising energy costs lead to recession and eventual collapse...,

thebull | How does the world reach limits? This is a question that few dare to examine. My analysis suggests that these limits will come in a very different way than most have expected–through financial stress that ultimately relates to rising unit energy costs, plus the need to use increasing amounts of energy for additional purposes:

- To extract oil and other minerals from locations where extraction is very difficult, such as in shale formations, or very deep under the sea;

    - To mitigate water shortages and pollution issues, using processes such as desalination and long distance transport of food; and
    - To attempt to reduce future fossil fuel use, by building devices such as solar panels and electric cars that increase fossil fuel energy use now in the hope of reducing energy use later.

We have long known that the world is likely to eventually reach limits. In 1972, the book The Limits to Growth by Donella Meadows and others modeled the likely impact of growing population, limited resources, and rising pollution in a finite world. They considered a number of scenarios under a range of different assumptions. These models strongly suggested the world economy would begin to hit limits in the first half of the 21st century and would eventually collapse.

The indications of the 1972 analysis were considered nonsense by most. Clearly, the world would work its way around limits of the type suggested. The world would find additional resources in short supply. It would become more efficient at using resources and would tackle the problem of rising pollution. The free market would handle any problems that might arise.

The Limits to Growth analysis modeled the world economy in terms of flows; it did not try to model the financial system. In recent years, I have been looking at the situation and have discovered that as we hit limits in a finite world, the financial system is the most vulnerable part because of the system because it ties everything else together. Debt in particular is vulnerable because the time-shifting aspect of debt “works” much better in a rapidly growing economy than in an economy that is barely growing or shrinking.

The problem that now looks like it has the potential to push the world into financial collapse is something no one would have thought of—high oil prices that take a slice out of the economy, without anything to show in return. Consumers find that their own salaries do not rise as oil prices rise. They find that they need to cut back on discretionary spending if they are to have adequate funds to pay for necessities produced using oil. Food is one such necessity; oil is used to run farm equipment, make herbicides and pesticides, and transport finished food products. The result of a cutback in discretionary spending is recession or near recession, and less job availability. Governments find themselves in  financial distress from trying to mitigate the recession-like impacts without adequate tax revenue.

One of our big problems now is a lack of cheap substitutes for oil. Highly touted renewable energy sources such as wind and solar PV are not cheap. They also do not substitute directly for oil, and they increase near-term fossil fuel consumption. Ethanol can act as an “oil extender,” but it is not cheap. Battery powered cars are also not cheap.

The issue of rising oil prices is really a two-sided issue. The least expensive sources of oil tend to be extracted first. Thus, the cost of producing oil tends to rise over time. As a result, oil producers tend to require ever-rising oil prices to cover their costs. It is the interaction of these two forces that leads to the likelihood of financial collapse in the near term:

- Need for ever-rising oil prices by oil producers.
- The adverse impact of high-energy prices on consumers.

If a cheap substitute for oil had already come along in adequate quantity, there would be no problem. The issue is that no suitable substitute has been found, and financial problems are here already. In fact, collapse may very well come from oil prices not rising high enough to satisfy the needs of those extracting the oil, because of worldwide recession.

Fertiliser shortage hits India's farms

From the BBC News;

Increasingly many countries across the world are beginning to recognise that expensive fertilisers, or even a supply shortage, is not just a problem for the farmers.

It has a direct effect on the cost and availability of food. Across the world countries are looking at farmers to produce a bumper crop this year to overcome global food shortage. As fertiliser prices go up – food prices go up as well, threatening to force millions of poor people into starvation.

Back on the farms, Mr Sehrawat is still waiting for his supply.

"It is really urgent that we get our supplies," he says.

"You can wait for monsoons - that's not under anyone's control - but you can't be made to wait for fertilisers.

"At this rate, people have to keep waiting for rice on their plates. Nothing is going to grow on our fields."

With general elections next year, the government in India could suffer the political consequences of poor agriculture output.

And the anger of unhappy farmers who cannot reap the benefits of a good monsoon.

It's always the details that come around to bite really, really hard. Fertilizer - as we all know - is a petrochemical dependent on natural gas feedstocks.

India consumes millions of tonnes of fertiliser each year.

Production costs have risen on the back of soaring crude oil prices.

Globally fertilizer rates have tripled in the last year.

Prices of the three main fertilizers, nitrogen, potash and phosphate, have gone up by almost 300%.

Diammonium phosphate costs nearly $1,300 (£650) per tonne whereas farmers in India pay around $250.

The Indian government subsidises the price by nearly 85% for farmers, which in turn means India's subsidy bill is getting bigger each year. At the current forecasts it amounts to almost 2.5% of the country's gross domestic product.

galloping growth and hunger in india

NYTimes | The 50-year-old farmer knew from experience that his onion crop was doomed when torrential rains pounded his fields throughout September, a month when the Indian monsoon normally peters out.

For lack of modern agricultural systems in this part of rural India, his land does not have adequate drainage trenches, and he has no safe, dry place to store onions. The farmer, Arun Namder Talele, said he lost 70 percent of his onion crop on his five-acre farm here, about 70 miles north of the western city of Aurangabad.

“There are no limits to my losses,” Mr. Talele said.

Mr. Talele’s misfortune, and that of many other farmers here, is a grim reminder of a persistent fact: India, despite its ambitions as an emerging economic giant, still struggles to feed its 1.1 billion people.

Four decades after the Green Revolution seemed to be solving India’s food problems, nearly half of Indian children age 5 or younger are malnourished. And soaring food prices, a problem around the world, are especially acute in India.

Globally, floods in Australia and drought in China have helped send food prices everywhere soaring — on fears the world will see a repeat of shortages in 2007 and 2008 that caused food riots in some poor countries, including Egypt.

While India’s agricultural problems are part of this bigger global puzzle, in many ways India’s food challenges are more entrenched and systemic than those faced elsewhere.

world food situation

FAO | » The FAO Food Price Index averaged 213 points in August 2012, unchanged from the previous month. Although still high, the Index value is 25 points below the peak (238 points) reached in February 2011 and 18 points less than in August last year. International prices of cereals and oils/fats changed little but sugar prices fell sharply, compensating for rising meat and dairy prices. 

» The FAO Cereal Price Index averaged 260 points in August, the same as in July, with some increases in wheat and rice offsetting a slight weakening in maize. Deteriorating crop prospects for maize in the United States and wheat in the Russian Federation initially underpinned export quotations, but prices eased towards the end of the month, following heavy rains in areas hardest hit by drought in the United States and the announcement that the Russian Federation would not impose export restrictions. Renewed import demand sustained international rice quotations.

 » The FAO Oils/Fats Price Index averaged 226 points in August, unchanged from July, thus staying above the ten year trend, although still below 2008 and 2011 highs. Similar to last month, additional gains in soybean oil prices and strengthening quotations for sunflower and rapeseed oils have been offset by persistent weakness in palm oil values.

» The FAO Meat Price Index averaged 170 points in August, up 4 points (2.2 percent) from July. All meat prices rose but most of the momentum came from the grain-intensive pig and poultry sectors, which saw their quotations firming by 4 and 6 percent respectively. The August price increase follows three consecutive months of declines.

» The FAO Dairy Price Index averaged 176 points in August, up 3 points (1.6 percent) from July, sustained by increases in the prices of skim milk powder, casein, butter and whole milk powder, while cheese prices remained stable. Much of the recent strength stems from a firming demand combined with production constraints in those areas affected by drought and rising feed costs. 

» The FAO Sugar Price Index averaged 297 points in August, down 27.7 points (8.5 percent) from July, and 97 points (25 percent ) from August last year. This month’s sharp fall in sugar prices reflects improved production outlook amid more favourable weather conditions in Brazil, the world’s largest sugar exporter, which was supportive to sugarcane harvesting, and recovering monsoon rains in India. 

no seriously, how ARE you humans going to feed youselves?

Alternet | Come October, Atlas won't be shrugging, he'll be groaning as global population passes the 7 billion mark. Until very recently, demographers predicted that these numbers would peak in 2050 at just over 9 billion and then start to decline. The latest research, however, suggests that despite declining fertility across much of the world, population will continue to rise through this century to over 10 billion people.

With famine spreading in Somalia, another food crisis gripping North Korea, global food prices near a record high, and climate change threatening to reduce future harvests, the question continues to nag: are we outstripping our capacity to feed ourselves?

The good news is that the harvests this year promise to be bountiful. The bad news is that this increased grain production may still not be enough. The worse news is that millions more mouths to feed, over the long term, will increase pressure on the world's farmers to squeeze more and more food from less and less arable land.

In 2010, the world dipped into food reserves to make up for a 60-million-ton shortfall in grain production. This year, predicts the Earth Policy Institute's Lester Brown, farmers will have to produce 100 million additional tons to meet last year's needs plus the increased demand. Based on a number of factors – better harvests in Russia versus droughts in China and the U.S. Midwest – Brown expects only an increase of about 80 million tons for 2011. The bottom line: food prices will continue to rise.

But that's just the short term. Most estimates of grain needs in 2050 suggest that production will have to increase by 70 percent. That means somehow conjuring a billion-plus tons of grain from the already strained resource base of Mother Earth.

There are basically four schools of thought on how to feed the world. The biotech crowd believes that genetic modification will eventually spur another Green Revolution that will dramatically boost yield per acre. The organics faction believes that industrial farming techniques have drained the aquifers and robbed the topsoil of nutrients, among other ecological ills, and only natural farming techniques can restore soil fertility and produce sustainable yields. Somewhere in the middle is the status-quo-plus gang, which believes that improvement of current practices can meet the needs of a growing world. And the fourth school is…well, I'll get to that in a moment.