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I think there may be some misinformation out there, as the responses here suggest.
It is a fallacy to believe food is plentiful and abundant, and that more can be quantitatively eased into production at will. The USDA pays farmers through the DCP program when the farmer decides to keep some land fallow. As an example, on a full section, the payment from the USDA is USD ~5000. Compare this to the worst possible revenue on that 640 acres, that revenue being about USD ~75000, and it is clear that farmers are not intentional running fallow acres, as this option loses money. A typical dryland field crop farmer will collect this DCP payment for the 3-4 months that he/she decides not to grow. The rest of the year these acres contain crops. So there is no reserve agricultural production waiting in the wings to fill up demand.
Next, it is suggested that the monetary policies of governments are inflating prices of food. This may be, but if that is so then we are in for an inflation nightmare, as well as food shortage. This is the case, as market vegetable prices at the terminal are currently outside the control and manipulation of the government. As such one can track real inflation or food inflation using these numbers. If one takes the two most purchased vegetables in the US, potatoes and tomatoes, one can see that inflation or food scarcity is running amok. As an example the price for wholesale tomatoes as incrased from .50 to 2 USD/pound in the last 20 years. Most of this increase has occurred since 2008, when the price was roughly 1 USD/pound of tomatoes. So in 18 years there has been 33 % increase in the price of tomatoes, and ~100 % increase in price in the last 2 years. The same holds true for potatoes. Potatoes have seen the cwt price increase from USD 9.40 in 1980 to USD 20 in 2007, and now sits at USD 33.50. Here we see a 117 % increase in price from 1980 to 2007, and a 67.50 % increase in the last three years. In addition the FAO shows that the commodities food price index has run relatively unchanged for the last 30 years, but since 2006 we have seen a 375 % increase in this index.
Since these large price increases in the last 3 years occurred pre QE, I would suggest that there is some argument for increased demand and decreasing supply causing the market price increases. I do agree that the loss of purchasing power caused by QE and other funny money creation is causing a great deal of the increases in food prices, but to suggest it is all caused by this shows....something.
I would suggest that commodities, to include food, are all becoming scarce. Agriculture is directly cost conscious of any changes in petroleum prices as almost all the inputs for agriculture are derivatives of petroleum production. A devalued dollar results in higher costs of inputs to farms, which then drives up food prices. At the same time assinine policies promoting bio fuel production, reduces the total global yield of foods, which also increases prices. More water is needed to produce these bio fuels, which water is taken from regular agriculture, which also increases food prices. Algae and ethanol production on a commercially viable scale is very far away. The water to make all this algae and ethanol is not available, unless it is taken from agriculture, or grown on coastline, which as someone mentioned would have problems as well.
My overall point is the agricultural support industries would have one think all is well on the agricultural front, it is not all quiet and well. Our scientific community has no new production methods to improve yields, instead it is focusing its attention on whatever nonsense comes out of some morons mouth, which moron is looking to make a quick dollar selling some old technology as new. Algae for biomass production was researched indepth in the 70s, and was found not be commercially viable. There have been no improvements in this area to change this overall conclusion. There has been a lot of money spent on bunk research, focused on the wrong aspects of this problem. Don't look to academia to fix this problem, academia has become a whore of the politicians and rarely comes up with anything useful. Most useful science comes from industry these days, and industry has not seen the value in funding agricultural production research in decades. Not that I really care, my farm is designed well and runs well. We return all capital needed for construction of our farm expansions in 2 years, and provide 15 % dividends each year for the last 10 years, on top of increasing the EBITDA by 100 % or more each year. So I am happy prices are going up, I am just worried that things will get out of control, as the prices continue to increase. Thus, I sound the alarm and hope someone will listen and do something about all of this. However, consensus suggest everyone will look away.
Keep eating the soma, and it will all be better.
The world is headed towards industrialised cannibalism.
Got Soylent Green?
Everything is simple, isn't it Graham? No need for lengthy analysis. Just a few hunches for your next article that came to you in the shower. Thanks for the great read! A stirring article, and to think it cost so little effort! Please give us some more of your in-depth analysis--the mind hungers for insight. Oh well, at least there's the Mad Hedgefund Trader with all his connections in high places.
And, subsidising corn as bio fuel is not a great idea either. USA needs to re-do it's agricultural model in a big way. This includes water collection and usage for other reasons than watering swimming pools and golf club fairways! Apart from the fact that all american food is industry processed. Nobody eats and cooks home grown produce. They'll all be taking lessons to make grandma's recipes. Last time I had hamburgers in US restaurant that tasted like real fresh meat was in the eighties!
I'd like to see that 'green' revolution beginning in every american's 'back yard'. 80% of american population, if it's like elsewhere is in urban locations.
This article is total BS. We subsidize the farmers not to plant the land. We use a massive amount of corn for fuel. Do a search on the internet under "how much land to feed a family of four", and you will see that most suburban families can produce most of their food just from their backyards, if they have to.
Sounds good in theory... If it's so easy then perhaps you can point out the millions who are currently doing it?
I'm sure that all those backyards that folks have in NYC are able to produce all that's necessary, right? And the Inuit, they've got lots of land, surely you can point out examples of them doing it, right?
How about you, how much are YOU producing out of YOUR backyard?
Foot and Mouth disease in the Koreas with possible spill over into China:
This article is total BS. We subsidize the farmers not to plant the land. We use a massive amount of corn for fuel. Do a search on the internet under "how much land to feed a family of four" and you will see that most suburban families can produce most of their food just from their backyards if they have to.
"We subsidize the farmers not to plant the land."
As much as I don't like subsidies, this claim is way exagerated. As a percentage of total income the amount of subsidies here is miniscule, and especially so in comparison to other subsidized activities that the govt undertakes.
The intent of such subsidies is to help farmers carrry their land during fallow periods. If you don't know what this means, then stay in the city and keep spouting shit that you don't know about.
NOTE: I don't do crops, in which case "fallow" doesn't apply to me; rather, I'm doing fast fallowing (MIG).
it is total BS and Mr Summers is making a habit of it... his 'advise' is based on very flawed data which even some basic quick research would expose as rubbish ...i wouldn't trust this plonkers advise to cross the road!
Advice / Advise -- one a noun and one a verb. Learn the difference.
thanks for the spell-check but if i wanted English lessons i'd get a teacher (highly unlikely) ... so long as you can read my writing (it's passable) fuk the corrections ok
The Summers article referred to WORLD demand, population, inventories...not western countries only...simplification... in global economies...and Humpty Dumpty was never on the wall, to fall!...
He said "We've" got problems coming Einstein.
Mr Summers poor research and hyper-bollox also included these two sentances, amongst others;
"The developed world, most notably the US, has been relatively immune to these developments… so far....And that’s not to say that food shortages can’t hit the developed world either."
The fatal flaw is in assuming that a current state can be maintained. Peak Oil critics were pleased to point out that in 1971 the US was producing MORE oil than it ever had. Facts clealry show that oil production didn't hold.
And, in case people have missed it, FOOD = ENERGY, and ENERGY = FOOD (nearly a 1/3 of the world's existing protien can be attributed to fossil fuels).
Peak Food. Deal/live with it.
We’ve got rapidly growing demand, reduced production, and decade low inventories. This is an absolute recipe for disaster.
Total Rubbish Mr Summers.
"We" (in the West) have not got rapidly growing demand. Western population rates are static. food demand is going precisely nowehere. If by "rapid" by you mean watching paint dry then you may be onto something or as I think on something!
If by "reduced production" you mean America and Europe being able to over-produce food by 30% then again you're on something trippy.
Finally regards "low inventories" this is not because of supply shortages it's because food is periscable requiring a fast just-in-time supply chain and additionally businesses have worked on reducing capital employed by successfully reducing stock in the system.
All 3 of your premises are false. Which is why your conclusion is 'hysterical' in both senses of the word. What planet are you on Mr Summers???
Back at it I see.... Man, did you get bitch slapped by the 2 libertarian farmers in that food thread the other day. They took you to school. Takes real guts to come back and spout the same nonsense... Shall I provide a link for the others to enjoy?
30% of 800 million is 240 million... BFD
Your delusionary life continues. The only one who's going to get "bitch slapped" are the hysteric "peak ..oil...food...hot temperature" loons like yourself who can't see reality nor understand how the world works.
Don't think of bitch slapping though you weeds of socialism may fancy a bit of dominating. Think of stone cold reality keep smacking you ignorant lentil-suckers in the nose over the coming years as all your shrill predictions disappear into dust and probably up your rectums too from where they came
Same old bull shit... ad hominems and not much else. I don't even care for lentils..
ALL made possible by easy access to cheap fossil fuels, hence the current adventures in the ME.
And while people are starving and rioting over food, our government mandates that we use corn to burn in autos.
Never underestimate the stupidity of our politicians.
"Never underestimate the stupidity of our politicians."
It's got nothing to do with stupidity and everything to do with planned rape. These fuckers know EXACTLY what they're doing. They sucker their small-time constiuents to "grass-roots" for something (like bio-fuels = energy independence) and then, POOF, magically there are "solutions" in the form of conveniently connected (to the politicians) corporations "willing" to "give" the people what they want! This movie gets old...
Pray we do not have drought in the US growing season this Spring! Prices could sky rocket and shortages would be everywhere.
after the last deer, squirrel, bunny, rat, snake, termite, roach, weed is eaten, what then?....
....The Joys of Soylent Green, btchz.
Gives new meaning to the phrase "eat dirt!"
Bugs you can eat:
The effects of the cold weather spell on Florida and Mexico food supplies, and also Texas, have been well documented.
Are these infommercials paid for placement on Zero Hedge ?
Hometown Buffet still offers enough food to feed a small country for 10 dollars a pop. I say no food shortage - you just need to locate your nearby Lubys, Hometown, Golden Corral or other all you can eat buffet.
The program Smith has grown beyond your control
Peak population very close? adding a billion souls to the planet between now and 2024 seems unlikely.
The Book of Revelations could very well confirm this.
Eat the cow, butcher the sow, shoot the neighbor, plant the seed, read the bible, pray for armageddon to do the rest. Its every man for himself and may the devil take the hindmost. That is the ultimate truth of the land where pursuit of happiness was initially seen as the dream. But whose reality now is so distorted that tortillas and enchiladas wont take its taste away. Long live greed, guns n god...in any order that you may want. It is the swan song of the black swan empire. Good riddance...long live the legend of Geronimo.
It's called KARMA. Payoff for using force and deceit for what we want. Selling the natives pox infested blankets comes to mind.
Paybacks are a bitch. Eat shit fuckers!
Codex is the beginning of food rationing.
Will never happen in the "Land of the Fee and the Home of the Slave"....well, except WW2 and next month.
My position: zero debt, living expenses less than 5 percent of my monthly income. cash and other assets......guns and bullets. survival gear. etc.
Do you really think they have our food safety in mind?
Read This, about a Bill, just passed, recently: Who passed it and why ??
As you read this, there is a bill before the U.S. Senate that has the potential to change the U.S. food industry more than any other law ever passed by the U.S. Congress. In the name of "food safety", the U.S. government would be given an iron grip over the production, transportation and sale of all food in the United States. Hordes of small food producers and organic farmers could potentially be put out of business. If this bill becomes law, the freedom to grow what you want, eat what you want and to share food from your gardens with your neighbors could be greatly curtailed. It would give the FDA unprecedented discretion to regulate U.S. food production. A version of this bill was already passed by the U.S. House of Representatives last summer, and now S. 510, also know as the FDA Food Safety Modernization Act, is in front of the U.S. Senate and it is expected to pass easily.
Because of how vaguely it is written and because of how much discretion it gives to the FDA, it is potentially a very, very dangerous law.
So who is actually in favor of it?
Well, big food corporations and big agriculture are actually very much in favor of this bill.
Is it because they are so concerned about food safety?
In fact, virtually every major case of food contamination in recent U.S. history has come from large-scale industrial agriculture or large-scale industrial food production.
The real reason why they are backing S. 510 is because it will devastate their primary competition - small food producers and organic farmers.
In recent years, the demand for organic food has skyrocketed as the American people have learned the truth about how our food is actually made. Big agriculture and the giant food producers are losing profits as Americans increasingly vote with their wallets.
So now the food giants are using "food safety" as a way to get market share back. It is an open secret that many of those involved in drafting this bill and in pushing it through Congress have ties to food industry giants.
Thousands of small food producers and organic farmers will have their very existence threatened by this bill. It imposes a bureaucratic nightmare on all food producers that the big corporations will be able to handle easily but that will cripple much smaller operations.
Already, many farmers can see the writing on the wall. One small farmer recently described the mood among her fellow small farmers to the Wall Street Journal....
"I know people who have been small farmers for 25 to 30 years who are looking to get out of the business because food safety is becoming so alarmist."
The Elitist's are going for the gugular. And if you don't think this is all planned, check-out Bill 510 which passed. With everything else they are doing to us,....do you really think they are concerned with our safety? REALLY?
No you're right, it's about control of the food and food supply and driving out the little guys to form monopolies and dependencies.
George Soros owns $321 million of Monsanto which was given a virtual monoploy on their products in the "food safety bill". He also owned 10,000 shares of the company that sells the TSA the scannner machines.
The UN has mandated Codex Alimentarious which will drive small farmers out of business. It's really theft. Has to do with following new strict rules and documenting the chain of food care from seed to kitchen table. It began being implemented in the USA last year. If enforced to it's full extent roadside vendors, and even private family gardens, would be prohibited -- for your protection!
A Texas friend of mine told me tonight the World Food Mkt there is pulling produce from certain suppliers "for not being up to standards" -- which sounded to me like implementation of C.A.
TPTB won't be happy until we go Cairo on them.
Ah... Earl Butz made it official US policy back during the Nixon administration: "get big or get out."
The UN is an extension of US power, don't anybody forget that. They help US corporations penetrate other lands. Kind of like the creation of OPEC, which was, for the most part, just an extention of the Texas Railroad Commission.
But, yeah, it's pure socialism... the people starving and the rich getting richer. Yeah, that's the definition of it alrighty...
And then there's the Coors clan to inebriate folks such that they don't know they're being fucked. Gettin' it from both sides...
The transportation system IS the lifeline to their control. Think of Khyber Pass for professionals...
Soros, eh? With a market cap of $85.5B, Soros's $321M of Monsanto (common, I presume) would be only a 0.375% share. You see this as a controlling interest?
Are you really a Gwar guy? I know some of those guys from RKL days.
I found this last week, Whole Foods has always sucked: http://foodfreedom.wordpress.com/2011/01/27/organic-elite-surrenders-to-...
Someone posted the great Zappa quote earlier in the week: The illusion of freedom will continue as long as it's profitable to continue the illusion. At the point where the illusion becomes too expensive to maintain, they will just take down the scenery, they will pull back the curtains, they will move the tables and chairs out of the way, and you will see the brick wall at the back of the theatre. (1977)
The CBs already own the majority of the gold, now they are going for the land. What land they can't get their greedy little mitts on they are attempting to control through food legislation. Interesting article the other day on the Rothschilds backing the commercial investment firm.
That bill has always been evil. The consensus from the growers I know is that it's un-enforcable. Even if it were I think it lacks popular support...That and my whole string of posts and the reaction on this page alone seems proof positive there are some scared folks out there. Scared people are easier to control, it works both ways - we are and they are. Here's another example of them scared: http://www.rawstory.com/rs/2011/02/17/former-cia-analyst-accosted-during...
War or not, everyone needs food and water.
Running around stealing it from each other is not looking so good or necessarily sustainable. There are other potential realities between the can being kicked down the road, war and full global mad max.
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