Welcome to European Tribune. It's gone a bit quiet around here these days, but it's still going.
I'm trying to figure out whether this is a regional issue (US Middle West) or a global one.

A quick search on web sites following crop growing here in France, one of the largest wheat producers in Western Europe, didn't show any particular concern of wheat shortages next year. Quite the opposite: farmers seem mostly concerned with the wheat prices going south (300€ per ton last year, half of this today). Part of this is pegged on diminishing meat and poultry consumption worldwide because of the bad economy (2 kg worth of grains needed for each kg of poultry meat).

And the fall of maritime shipping costs is expected to bring more competition from Australian and Argentinian farmers.

I don't know much about the region, but the Dakotas don't strike me as the ideal geography to grow wheat: propane heating to prevent the crop from rotting? Never heard of this in Western Europe. AFAIK, wheat is harvested in late June in Provence, first half of July around my home town of Toulouse (all wrapped up by Bastille Day) up to end of August or early September in the northern part of the country; all of of this without any propane heating.

This is not to dismiss the magnitude of the problem: experts acknowledge that "a lower harvest in the United States always has serious repercussions in the rest of the world".

Again, I'm just trying to figure out what the effects will be on the world at large, beyond the serious problems faced by your friends and neighbors.

And crop yields doesn't seem to be the only problem for world wide cereal trade: maritime shipping is facing serious troubles of its own, as already pointed out on ET, here and here.

by Bernard (bernard) on Sat Nov 29th, 2008 at 01:26:03 PM EST

 The corn gets dried, not the wheat.

 The U.S., Canada, and Australia are major exporters. Some parts of the former Soviet Union are also players in this market. Globally per capita wheat stocks have been a consistent seventy pounds my whole life, until three years ago when they sank to forty pounds. If we have one bad harvest, which seems likely given underfertilization, that number goes below some critical level and the civil disorder events in Egypt, Kuwait, and Pakistan last year become weekly rituals.

  I wrote more about the wheat harvest concerns on The Cutting Edge News and I'll happily share my spreadsheet of wheat stocks vs. human population.


by SacredCowTipper (sct@strandedwind.org) on Sun Nov 30th, 2008 at 11:48:20 AM EST
[ Parent ]
Thanks Neal.

Again, my question was about the WW picture. If indeed, we have a bad harvest next year (and the signs from your  neighborhood are not looking good at all), then the first sign should be grain prices going North again...

Over here, from my cursory reading, farmers seemed to be cutting on wheat growing, but mostly because of costs (fertilizers, fuel...) vs. lowered sale price; one estimate of the break-even point being at 145€ per ton, including CAP aid.

But this is Western Europe: the Middle-Eastern countries you mentioned are large grain importers and any imbalance in the global supply would definitely show there first.

by Bernard (bernard) on Sun Nov 30th, 2008 at 01:42:28 PM EST
[ Parent ]

 How can the commodity price go north when everything else is sliding south? Grain will be more precious but that won't be translated into a price increase in the midst of a massive deflation ... right?
by SacredCowTipper (sct@strandedwind.org) on Sun Nov 30th, 2008 at 08:25:17 PM EST
[ Parent ]
Seems like Cargill and ADM are sitting on their cash and not loaning it to Brazilian farmers, so their crops will fall short.
by northsylvania on Mon Dec 1st, 2008 at 03:23:57 PM EST
[ Parent ]


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