New wheat crisis plagues world food supply - Top Stocks
 
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New wheat crisis plagues world food supply

Posted Mar 27 2008, 03:46 AM by Jon Markman

If it seems like you are paying more for your cereal, beer and pizza lately, shake your fist in the direction of Pakistan, Uganda and Argentina, because a weird confluence of international events are combining to slash the world supply of wheat and boost prices. The downside of globalization is that a crop failure 10,000 miles away can lead to pricier brewskis here. 

It's actually a lot more serious than that. The New Scientist magazine reports that a wheat disease that started in central Africa actually threatens to destroy most of the world wheat crop, leaving millions to starve. A fungus called Ug99 has already spread from Africa to Iran and is bearing down on Pakistan, according to the report. This is bad news because Pakistan and Punjab wheat is extremely important to the entire food chain of the densely populous plains of South Asia.

According to reports, scientists hope to slow the spread of Ug99 by spraying new forms of fungicide but the only real firebreak will come when agronomists are able to create Ug99-resistant strains of wheat over the next few years. The disease, which is said to be a super-strong strain of black stem rust, first came to light in Uganda in 1999 and has since ruined crops in Kenya, Ethiopia and Yemen. Now winds are expected to take the spores to Egypt, Turkey, Syria and Iran. Chinese scientists are said to be on a crash program to develop Ug99-resistant wheat strains before the disease ravages its already weakened croplands.

Meanwhile, down in Argentina, a three-week protest by farmers has curtailed shipments of wheat into supermarkets, pushing that country into its worst political crisis since 2002. News media report that thousands of farmers are withholding meat and grains from wholesalers and blocking country roads to oppose a hike in export taxes. Argentina’s president, Cristina Kirchner, has accused farmers of extortion, while protesters fill streets, banging pots and pans.

Food shortages in Buenos Aires are worsening, and the media reports that shops have run out of beef and chicken, while fruits and vegetables are soaring in price. The government is said to be digging in its heels on the tax increases that it believes are necessary to support social programs such as fuel and health care subsidies, while farmers say they are being unfairly targeted. The upshot is that the turmoil has also curtailed exports, putting strains on world wheat prices.

For more on the worldwide food crisis, see my column of March 6, "Could we really run out of food?"

Comments

 

What ever happened to the Amber Waves of Grain in America.  We still have farms don't we?  

You didn't mention the U.S. exposure to this disease? Winter wheat just starting now to grow into 1st cut, are farmers planting more wheat to take advantage of pricing? How bad could we be hurt?

Lets get real here, the price of wheat has more than doubled in the last two years, but 1 can of beer is about 3/4 of a pound.  A bushel of wheat is $10.50 that makes it $.175 per pound meaning if beer was pure wheat there is .13125 dollars worth of wheat in a can of beer.  Don't blame wheat for price hikes.  It could be critical for world food supplies yes, but lets drop the rhetoric about high food prices.  Energy costs are much more likely to have contributed to the increased price of your beer, than the price of wheat.

Too bad the beer industry here doesn't suffer some sort of blight that would wipe out Anheuser-Busch altogether. A blight like, say, consumers demanding REAL beer instead of that corn and rice sugar poison. Anheuser's so-called "beers" would not pass for rat pee in Europe.  Now they have destroyed Rolling Rock, the last mass produced beer that adhered t the Rheinheitsgebot laws of Germany.

With recent reports of decreased world supply and an explosion of futures wheat prices in the US you would think somehow we could work to put some of that money in the hands of the american farmer.  With soaring fertilizer prices and availability scare, it is sad to see fertilizer being exported into foregin markets where the value of their currency is stronger.  Combined with increased input costs, of fuel, fertilizer and machinery the ever shrinking profit margin is tightening daily due to increased revenue which never means the american farmer is getting fat pockets, it only correlates to many more hands digging into those pockets!!!

How come no mention of Ethanol? As demand for the alternative fuel increases, it drives up the price of corn therefore enticing farmers to grow only corn. Not to mention that large corporations are subsidizing farmland just for this purpose. Now, its possible that the only reason that wheat has gone up in price from $15 a bag to nearly $40 a bag as a direct result from the fungus. But we do need to also weigh in other factors. I suggest people research this topic, you may find the cons severely outweigh the pros; world hunger being one of them.

It's the end of the world as we know it.  Bible prophesies fulfilled before our very eyes.  This would be the pale horse rider of the famed four horsemen of the apocalypse.  

wheat is just one of many greedy, money hungry issues we all face now. the gas issue is a lie. there is no shortage, it's our weak dollar. why is it weak, because we spend and spend on stupid things, we can't even take care of our own but we give and give to other countries. we make a "war" and then pay for all the damage. isn't a war's purpose to kick some tail? our dollar is weak because we are in so much debt. so what is our answer? burrow more money from china to give us in may. what?

how is that going to help? it puts us deeper in the hole, it's not going to make a long term difference, and we spend the money on things made where? china. back to gas, the selected alternative fuel is the most expensive and least plausible alternative available. why? seems it's a good reason to increase prices on something else. grow more corn, reduce wheat. what is this country thinking anymore? our government seems bent on  bringing this country to it's knees at a breakneck speed. oil companies make record profits but we all pay the price. any wonder why we are in a recession? we can't afford anything much more than gas and food. take a genious to figure this out? or how about how all these geniouses who can barely afford a house payment at a low variable interest rate, then oh my goodness, the rate goes up and up(big suprize) now all these morons can't afford their home. gee, do you read what you sign? now you've got the moron banks crying.Do you actually look at who you are loaning money to and assessing risk? apparently not or you wouldn't be in this situation. the home owners who can't pay the banks are all going broke. you're both to blame and now you expect a broke government to bail you out?until the government makes oil companies stop gouging us, seeks plausible alternative fuel and stops borrowing from china we are headed for certain disaster.  do you relaize if china calledin our debt at this minute, our economy would cumble? don't hold your breath for help, money, greed and power are all they care about, not you, not me, not our children. this country is a great place to live but it's upside down and i din't ever recall such a money hungry frenzy that makes everything so expensive. sad, very sad.

While this is all true, it does not address the reason that bud light prices are increasing.  The U.S. has for a long time been the largest grower and exporter of wheat.  We are self sufficient in this foodstuff.  The problem with the prices in this country is the shift to corn for ethanol.  Why do we not report the probem the shift to corn is creating, more expensive food, clothes and fuel.  Can't anybody be honest that the move to green is becoming massively costly to consumers and gaining us little in what its intent is.  Why does no one marry these two stories?

It seems that the global economy can be used to justify higher prices when we were told that it would mean lower prices.  Just like the illegals working in the building industry for cheaper wages has not produced lower priced housing.  In other words, like gas prices ging up the dumb consumer will believe any excuse to justify high prices.  Gullible consumers are their own worse enemy.

Just don't buy pizzas and beer and see what happens.  You have to buy gas to get to work.  

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