Whether the world tips into agricultural catastrophe this year depends on the fate of the wheat crop on the North China Plain though if you measure a few billion hungry bellies one could argue that the catastrophe is already upon us. The era of abundance that fueled the world’s population growth to almost seven billion people is over and so is the free ride of unlimited credit and debt, except, that is, for the American government that just prints the money it needs electronically even though it brings inflation to the whole world by doing so.
The New York Times reported that the United Nations issued an alert on the 15th of February warning that a severe drought was threatening the wheat crop in China. “China’s grain situation is critical to the rest of the world—if they are forced to go out on the market to procure adequate supplies for their population, it could send huge shock waves through the world’s grain markets,” said Robert S. Zeigler. The state-run news media in China warned Monday that the country’s major agricultural regions were facing their worst drought in 60 years. On Tuesday the state news agency Xinhua said that Shandong Province, a cornerstone of Chinese grain production, was bracing for its worst drought in 200 years unless substantial precipitation came by the end of this month.
The severe drought in northern China has badly damaged the winter wheat crop and left the ground very dry for the spring planting, fueling inflation and alarming China’s leaders. China’s wheat imports have risen to 893,700 metric tons in 2009 and 1.2 million metric tons in 2010 from just 31,900 metric tons in 2008, according to figures from Global Trade Information Services, a data company in Columbia, S.C.
“Global food prices are rising to dangerous levels and threaten tens of millions of poor people,” said World Bank chief Robert Zoellick. “It’s poor people who are now facing incredible pressure to feed themselves and their families.” But the American government does not care.
Robert Bryce, writing for the Washington Times said, “Last month, Peter Brabeck, the chairman of the Swiss food giant Nestle, declared that using food crops to make biofuels was “absolute madness.” The epicenter of that madness is the U.S. corn-ethanol sector. This year, it will consume 40 percent of all U.S. corn—that’s about 15 percent of global corn production or 5 percent of all global grain—in order to produce a volume of motor fuel with the energy equivalent of about 0.6 percent of global oil needs. Congress (insanely) lavishes about $7 billion in annual subsidies, mandates and tariff protections upon an industry that is helping push global food prices to all-time highs and shrink grain reserves at the very same time that global grain production is faltering and protests over food prices are becoming common.” Most of us know that madness is not something new for the American government but it has continued to increase its meanness and depravity to levels that even the most obscene beings in human history would envy.
The entire world is coming apart at the seams and, worse, there is no solution until we hit the wall and the bulk of us are squashed like flies. Perhaps we could avoid some of the misery heading our way if the government of the United States was simply dissolved, giving back full governance to the States to manage their own affairs. Might as well chuck the European Union while we are at it.
But since no one is considering such a good idea, the crisis itself is going to have to be the solution and it will carry with it devastating changes to a broad swath of humanity. There is no point even in standing up boldly in an attempt to save the future for that future has already been stolen by a monstrous elite who have known where this is all heading for a long time. Rich people can be as stupid and mean as anyone else and obviously there are more psychopaths and sociopaths in the world than we can possibly imagine.
As we run the rapids down to financial and social oblivion we will not be able to trust the press to inform us with information to make appropriate decisions. The public will be deceived until the very end. Governments around the world are on the brink of collapse and there is no way to stop what is coming and what is happening.
Is it time to panic yet? There is never really a good time to panic but if a little bit of panic is what it takes to motivate you into action, go for it. Embrace some panic and then move your butts and prepare accordingly. “For what?” you might ask. “For everything!” I might say. With food shortages or food priced so high, it will take major funds that you will not have to eat satisfactorily.
Joel Bowman, in an article in the Daily Reckoning, tells us, “It’s getting more and more expensive to live from hand to mouth as the overwhelming majorities in these countries do. More than 40 percent of the Egyptian people live on $2 per day or less. A whopping 70 percent rely on food subsidies and handouts. A few percent increase in the price of milk and honey may not break the bank for the average American or European (at least, not yet)… but for those living in Egypt and her surrounding states, it’s the difference between eating and going hungry. These people, it may be fairly said, are quite literally starving for change.”
Feeding 219,000 more people every night is not something that can be done with prices on the rise and supply and food stocks falling dangerously due to dramatic climate conditions.
Authoritarian governments across the world are aggressively stockpiling food as a buffer against soaring food costs that they fear may stoke popular discontent. Algeria purchased 800,000 tons of milling wheat early in February and Saudi Arabia has said it will purchase enough wheat for a 12-month reserve. Bangladesh has tripled its rice import target and Indonesia this week bought 820,000 tons of Thai rice. “This is only the start of the panic buying,” said Ker Chung Yang, commodities analyst at Singapore-based Phillip Futures.
“The price of wheat is setting an all-time high in the United Kingdom. Food riots are spreading across Algeria. Russia is importing grain to sustain its cattle herds until spring grazing begins. India is wrestling with an 18-percent annual food inflation rate, sparking protests. China is looking abroad for potentially massive quantities of wheat and corn. The Mexican government is buying corn futures to avoid unmanageable tortilla price rises,” writes Lester R. Brown.
“With pincers closing in on world food output from so many sides, we have little margin for error,” writes Ambrose Evans-Pritchard, who is very concerned that the honey bee colony collapse syndrome is going to cut forcefully into world food output, as if we did not already have enough to be alarmed about in terms of rising food prices and falling food stocks.
Floods have caused significant damage to South Africa’s agriculture sector, with production of corn, sunflower seeds and raisins all affected. Argentina’s Corn Crop Forecast Cut 4.9% on Drought. Argentine corn farmers will harvest 19.5 million metric tons of corn this season as a drought in the world’s second-largest exporter trims output to below estimates, the Buenos Aires Cereals Exchange said.
At least 29 countries have sharply curbed food exports in recent months to ensure that their own people have enough to eat at affordable prices. When it comes to rice, India, Vietnam, China and 11 other countries have limited or banned exports. Fifteen countries, including Pakistan and Bolivia, have capped or halted wheat exports. More than a dozen have limited corn exports. Kazakhstan has restricted exports of sunflower seeds.
“People are in a panic, so they are buying more and more—at least, those who have money are buying,” said Conching Vasquez, a 56-year-old rice vendor who, one recent morning, sat among piles of rice at her large stall in Los Baños in the Philippines, the world’s largest rice importer. Her customers buy 8,000 pounds of rice a day, up from 5,500 pounds a year ago.