Agriculture's Big Picture
AgWeb Editor Greg Vincent takes a big-picture look at agriculture and current events.
Thoughts from the KC Fed Ag Meeting; China Ups Soybean Purchases
Jun 10, 2010
I’ll start today with a few thoughts from the Kansas City Fed’s Ag Symposium I attended the last two days. Watch for more stories on this meeting
throughout the week.
- Overall, the general feeling about the future of agriculture is fantastic
- There are several outliers that have some of the experts concerned…
- Political instability in the world where growing economies exist
- Interest rates that can only go higher
- Inevitable inflation to pay for the sins of the 0% interest rates
- Structurally, the agriculture industry is in for severe changes over the next 5-10 years and we will not recognize our industry in 10 years
- You need to get ready for the big changes Wal-Mart has announced that EVERY product it sells in its stores will have an environmental footprint statement by 2015
- Financial markets and commodity markets are joined at the hip, which means anything that impacts the international financial systems will impact your business…read that as increased volatility
- The volatility in the market—both output and input—we’ve seen in the past few years is nothing compared to what we’ll see as we move through this time of extreme structural change
Now, back to our regularly scheduled program…
The Nikkei gained 1.10% in Japan and European markets are following suit today. They are trading slightly higher. Of course, BP stock isn’t doing much to bring any of these indexes higher.
Yesterday, China upped its purchases of U.S. soybeans, opting out of its expected purchases of product from Argentina. Now there’s talk of a strike in Argentina next week and that number could go higher.
On Tuesday the New York Times ran an article focusing on how the Amish farm in Lancaster County, Pa. Yes, it’s organic. Yes, their practices are much the same as those they used in the mid-1800s. And yes, those practices are contributing to the dangerous environmental conditions in the Chesapeake Bay area.
Farmers in the Western U.S. are dealing with a grasshopper infestation of biblical proportions. The New York Times says it’s going to be a tough fight, as many ranchers are opting for no prophylactic spraying.
And finally, a pretty sad note from Africa -- but yet another reason why biotech products like Bt corn are good for humanity. It seems, according to a story from Reuters, that a fungus that grows on corn as a result of damage from corn borers is spreading through Africa. This toxin, in addition to causing cancer, may also be helping to spread HIV throughout the continent.