There's been bad news on the global food supply front.
The last thing the world needs is more bad news, but there's more bad news on the global commodities front:
Wheat rose the most in nearly two weeks after the U.S. Department of Agriculture lowered its forecast for global stockpiles and said domestic cattle producers would use more of the grain as livestock feed.Global stockpiles will be 173 million metric tons on May 31, down from 176.71 million estimated on Sept. 12, the USDA said today in a report. World production was forecast at 653.05 million tons, down 0.9 percent from last month. About 315 million bushels in the U.S. will be fed to cattle, up from last monthâ??s prediction of 220 million, the USDA said.
â??The wheat crop in Russia is down, Canada is down, Australia is down,â? Jason Britt, the president of brokerage Central States Commodities Inc. in Kansas City, Missouri, said by telephone. â??There seems to be a trend.â?
Meanwhile, the UN is issuing a broader warning:
According to the Food and Agriculture Organisation (FAO) in Rome, global wheat production is expected to fall 5.2% in 2012 and yields from many other crops grown to feed animals could be 10% down on last year."Populations are growing but production is not keeping up with consumption. Prices for wheat have already risen 25% in 2012, maize 13% and dairy prices rose 7% just last month. Food reserves, [held to provide a buffer against rising prices] are at a critical low level
"It means that food supplies are tight across the board and there is very little room for unexpected events," said Abdolreza Abbassian, a senior economist with the FAO.
Maybe now would be a good time to re-examine the (insane) policy of burning food to fuel our cars.
