Burning Food  

Posted by Big Gav

Just a short post tonight - there is plenty of fodder in the link bucket though.

During Alan Kohler's spot on TV tonight he talked about rising world grain prices - fueled by demand for ethanol - and asked "who would have predicted rising oil prices would result in rising food prices". Well - I for one have predicted it, and George Monbiot did long ago. And I'm sure a host of other peak oil commentators have as well.

Another contributing factor is falling US grain production. No doubt rising natural gas (and hence fertiliser) prices are playing a part too.

The US Agriculture Department is tipping an 11 per cent drop in wheat production there over the next 12 months.

USDA World Agriculture Outlook Board Chairman Gerald Bange blames chronic drought and tough competition from Australia and Canada for lower exports. Mr Bange says part of the reason is a stronger US price forecast in '06/'07 due to lower production and tighter ending stocks.

Wheat prices look set to improve on the back of the USDA report, which has also revealed a substantial increase in corn exports. There is also higher domestic demand in the US for corn to make ethanol.

Natham Omodei from commodity trader Plum Grove, says that should make wheat more attractive as feed for livestock and drive up prices. "They increased use for ethanol production, which really cut their stock forecasts for 2006-2007," he said.



Food to burn, for now



What will they eat ?

5 comments

A few possibilities:
Their shoe.
Their shorts.

Anonymous   says 1:41 PM

Kohlers comments suggest an opening for economists with even a basic grasp of thermodynamics... maybe.

And in relation to the article below... it seems Latham was wrong about another thing... there was no "conga line of suck holes", there was only ever Howard.

SP

WHT - you forgot "each other" (I sense a movie sequel coming up: "Soylent Green - Revolutions").

Anon: Economists have a stock answer for this "rising prices will spur development of new supplies".

I always enjoyed Latham's turn of phrase - the conga line quote was a classic, regardless of its accuracy (and I'd say Johnny, Downer and Ruddock - at the least - comprise a conga line).

The whole site's worth visiting. Check out the maps for Gas and Coal exports and imports; there are also maps for Liquid Petroleum exports and imports. Flip between each pair, and you can sense which countries have a dependency on energy imports.

daois - thanks for the tip - if you read the previous post (http://peakenergy.blogspot.com/2006/05/what-small-country-can-do.html), you'll see I've already linked up exactly that set of 4 graphs !

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