Monday, June 21, 2010

The WSJ on the Global Grain Surplus

Today's WSJ article about a global grain glut due to our global macro economic condition stated what I wrote here months ago, on this blog, which even precipitated an outrage from Jim Rogers, Mr. "the world is running out of grain" himself. Don't miss it! (And this is one of the reasons why I would not be buying farmland now, either.) When I have time, I hope write an update on this subject sometime soon.

Global Grain Surplus Sows Trouble

....Grain traders in Chicago expect U.S. farmers to produce record-large corn and soybean crops for the second straight year. Farmers in Brazil and Argentina are wrapping up record-large soybean harvests. Asian farmers are poised to produce a huge rice crop. According to forecasts by the United Nations' Food and Agriculture Organization, this year's global cereal reserves—the buffer against shortages—will probably be 24% bigger than just two years ago, and the largest in eight years......If an economic recovery doesn't gather steam soon, says one group, price-depressing grain gluts could materialize in a few years, dragging down farmers' profits and chilling farmers' demand for everything from tractors to genetically modified seed.....