Grains, Soybeans Jump on USDA Data, Signaling Higher Food Costs

[phantom power]

U.S. corn stockpiles at the beginning of March dropped to 6.52 billion bushels, the lowest for the date since 2007, the Department of Agriculture said today. Last month, the prices of corn, soybeans, wheat and rice climbed to the highest since 2008, when surging food costs spurred riots from Haiti to Egypt. Today, cattle rose to a record for a second straight day, and cotton surged.

“What’s unique about 2011, unlike 2008, is that corn and soybeans are equally tight, cotton is tight, and wheat isn’t comfortable either,” said Hussein Allidina, the head of commodity research at Morgan Stanley in New York. “The takeaway is that prices are not high enough to ration demand.”

...

“The healthiest thing that can happen now is for prices to rise and slow demand,” said Sal Gilbertie, the president of Teucrium Trading LLC, which in June launched an exchange-traded product linked to corn futures. “We will deplete reserves before the end of the summer,” because meat and ethanol makers already have purchased supplies, he said.

http://www.businessweek.com/news/2011-03-31/grains-soybeans-jump-on-usda-data-signaling-higher-food-costs.html

[Blue Meany]

1. Some would argue that was is made from soybeans and corn

in this country isn't really food, but nevertheless it will raise food prices.

[Possumpoint]

2. Stop Ethanol Now!

Uses more energy then it saves. It's use is driving up food costs.

[elleng]

3. healthiest thing that can happen now is for prices to rise and slow demand

Am I missing something? Worldwide people starving > slow demand??? Or just talking about U.S?

[phantom power]

4. I believe that was focused on the US, but either way, the idea is...

price increases enough to slow consumption, to *prevent* actual food shortages. Kind of like how I hope that oil and fuel settle into a price range that is high enough to slow consumption, without immediately crashing the world economy.

[Nihil]

6. I'm hoping it was just bad phrasing ...

... rather than promoting starvation per se but I think it is too late
for that little game:
OP>> because meat and ethanol makers already have purchased supplies

i.e., raising the price would not affect the "for-profit" purchasers and
would only impact the "for-food" people who can't afford to speculate,
just eat.

:shrug:


On edit:
After going back to the OP again and seeing that the person who made that
quote was the president of a trading company "which in June launched an
exchange-traded product linked to corn futures", I'm less 'hopeful' than
when I wrote the above ... a profit-oriented parasite like that is unfortunately
far more likely to be in favour of starving the poor than impacting any other
for-profit business (like the ethanol scam) ...
:grr:

[elleng]

7. I'm afraid so, Nihil.

:(

[madrchsod]

5. speculation--it`s a sure fire way to make money.