Insight: The next crisis will be over food

[antigop]

http://www.ft.com/cms/s/5a9b3c72-db2e-11dc-9fdd-0000779fd2ac.html

I used to think that the fastest way to become worried about markets was to stare into the bowels of a monoline. No longer. A few days ago, I happened to hear Goldman Sachs discuss the state of the global financial system with European clients.

And what struck me most forcefully from this analysis – aside from the usual, horrific litany of bank woes – was just how much trouble is quietly brewing in corners of the commodities world.

Never mind that oil prices are high; that problem is already well known and gallons of ink have been spilt debating that, along with the pressures in metals and mineral spheres.

Instead, what is really catching the attention of Goldman Sachs now is the outlook for agricultural prices. Or as Jeff Currie, head of commodities research at the US bank, says with disarming cheer: “We think we could go into crisis mode in many commodities sectors in the next 12 to 18 months . . . and I would argue that agriculture is key here.”

[avenger64]

1. Heavy ...

... looks like with the Ethanol subsidees growing corn for fuel, we're going to have a choice - drive or eat.

[Fire Walk With Me]

2. Off the top of my uneducated head, I would guess that energy would be the next problem.

Considering what they've done to oil and the closed-door Cheney energy summit.. It's an easier way to control us than a hydraulic empire (water).

[Muttocracy]

5. in many parts of the world it will be drinking water nt

[acmavm]

6. It will be water period. Water for drinking, agriculture, whatever. We're

already fighting over water here in this country. And without that water don't even bother worrying about using grain for ethanol production. There won't be any.

[Muttocracy]

8. right, so much agr. is irrigation driven

We're growing crops where it's just not sustainable. Scary article today about Lake Mead drying up.

[BeHereNow]

12. Which is why the BFEE bought the land in Paraguay-

They know what's coming and don't give a damn
about the rest of us, as they have shown us repeatedly.
Katrina and NOLA victims. Need I say more?
BHN

[Muttocracy]

9. energy costs are also behind a lot of food costs

both in production and transport, so yes, energy is big deal

[HuskiesHowls]

3. Now for the real tough question

do you buy gas for the car, so you can go to work, or do you buy food so you can be healthy enough to work, if you ever find another way to get there??

And, living 30 miles away, riding a bike isn't quite in the picture.

[Rosemary2205]

4. More expensive food may not be all bad.

People below or at poverty will suffer terribly, and something has to be done to combat that, OF COURSE. But generally speaking, more expensive food in the US is not altogether a bad thing considering obesity.

[jwirr]

7. Take it from someone who got to be obese by eating only the

cheapest food her family could afford it will not help to have food more expensive. Then instead of eating salads we will be eating pastas, grains and eggs. Those things were often all we had to eat in the good old days.

[housewolf]

10. I posted this to the Cooking & Baking Group earlier today:

From King Arthur Flours:

Wheat prices are sky-high and rising.

To our valued flour customers:

You’ve undoubtedly heard the news about rising foods costs; perhaps you’ve already felt the impact on your pocketbook. Global wheat prices are at an all-time high, well over triple the cost per bushel since spring of last year. The combination of poor wheat harvests in parts of the world, low carryover stocks from last year, and high energy and input costs have created a very grim situation for wheat prices, which leads of course to higher flour prices.

Although all King Arthur Flour is milled from wheat grown here in North America, where the harvest was plentiful last year, global demand on our domestic supply has forced the price of wheat sky-high. We’re doing all we can to keep the cost of flour down by making our business as efficient as possible, but there’s simply no way for us to absorb entirely the impact of current record-breaking wheat prices.

more...
http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=236x41906

[happyslug]

11. May stop the migration from Mexico and Central America.

People forget, migrations requires TWO things, someplace people can go (the US) and a place they have to leave (Southern Mexico and Central America). Why have these Hispanics being leaving? The low price of Corn since NAFTA was implemented (and before NAFTA do to the low price of corn, but this was made worse by NAFTA that ended Mexican Tariffs on US Corn going into Mexico). Now that corn is at record prices, the cities of Central America and Southern Mexico are hurting do to the high price of Corn, but the farmers themselves are seeing prices that are high enough not only to pay the bills but for extras.

People forget it was NOT the urban poor of Central America and Southern Mexico moving north, it was the Rural poor. This pool is now drying up. If the rural poor no longer want to go north, immigration will stop. Thus, in the short term, we will see higher wages as the Hispanics stay home and NOT underbid our own poor. Many Hispanics will move back, but many will stay, but we are going to return to the low immigration of the 1940s-1960s as far as net immigration (Through it will take a long time, maybe five years for people to stop coming).

On the other hand, where crops fail, you will see immigration, if such people can move. I do NOT see that in Central America or Southern Mexico (The Coasts are to near for any prolong drought and the affects on farming of Hurricanes only last for no more than a season). Europe will see a net influx from Africa do to the increase drought do to global warming. Northern Mexico has always been dry, but the population is richer then the rest of Mexico and thus have always been less likely to migrate to the US compared to Southern Mexico.

I read an article that pointed out our war in Afghanistan is destabilizing Pakistan do to people migrating from Afghanistan to Pakistan do to the war and the drought (Which I last read of last year, it may be over now, but hurting the wheat crop over at least the last two years).

Just a comment on migration patterns. People will move if they have no food, but if they have food and they can make money, even if low by US standards, they will stay. Thus the push behind Migration will decline (as far as the US goes).

One last comment, most people go to a new area based on information from people they know who is in that area. This has been known for hundreds of years. A study of German immigrants from the later 1800s was done. In that study is was found the number one reason that the German immigrants to the US relied on to move to the US was from relatives and Friends already in the US. This pattern exists for other groups, people go where family members already are OR here Friends are. Thus the movement was slow then it perked up as the price of Corn Dropped And more and more people went to the US, relying on friends and relatives already in the US to help them find and do work. Most immigrations can read and write, so letters are still used, but long distance phone calls are cheap today, and add to the distribution of information to friends and relatives. Generally the contacts tell the potential immigrants both the Good and bad points of where they are at. This helps prepare the immigrants for the transition. Thus migration patterns tend to bell like curves, Slow starts, then a "flood" then a drop till it is a trickle. People go, tel their friends and relatives, who tell other people. The flow peaks, and then drops as conditions back home improve (as it appears to be) and you have a reverse trend, people back home tells the immigrants that things have improve, and if things are NOT good in the new place, come back home. I suspect that is how the immigration pattern will go, a peak and then a slow decline.