Environmental Valuation & Cost-Benefit News

According to The New York Times:
...Wheat prices have doubled in the last six months. Corn is on a tear. Barley, sunflower seeds, canola and soybeans are all up sharply.
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Everywhere, the cost of food is rising sharply. Whether the world is in for a long period of continued increases has become one of the most urgent issues in economics.

Many factors are contributing to the rise, but the biggest is runaway demand. In recent years, the world’s developing countries have been growing about 7 percent a year

Farmers the world over are producing flat-out. American agricultural exports are expected to increase 23 percent this year to $101 billion, a record. The world’s grain stockpiles have fallen to the lowest levels in decades.

“Everyone wants to eat like an American on this globe,” said Daniel W. Basse of the AgResource Company, a Chicago consultancy. “But if they do, we’re going to need another two or three globes to grow it all.”

In contrast to a run-up in the 1990s, investors this time are betting — as they buy and sell contracts for future delivery of food commodities — that scarcity and high prices will last for years.
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Rising food prices in the United States are already helping to fuel inflation...

The [price] increases that have already occurred are depriving poor people of food, setting off social unrest and even spurring riots in some countries.
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The Agriculture Department forecasts that farm income this year will be 50 percent greater than the average of the last 10 years.

[However],Farmers’ own costs are rising rapidly.
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Around the world, wheat is becoming a precious commodity. In Pakistan, thousands of paramilitary troops have been deployed since January to guard trucks carrying wheat and flour.
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In the United States, the price of dry pasta has risen 20 percent since October, according to government data. Flour is up 19 percent since last summer. Over all, food and beverage prices are rising 4 percent a year, the fastest pace in nearly two decades.
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The Agriculture Department forecasts that world wheat production will increase 8 percent this year. In the United States, spring and durum wheat plantings are expected to rise by two million acres, helping to drive prices down to $7 a bushel, the government said.

Yet the competition among crops for acreage has become so intense that some farmers think the government and analysts ... are being overly optimistic.
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Nigeria grows little wheat, but its people have developed a taste for bread, in part because of marketing by American exporters. Between 1995 and 2005, per capita wheat consumption in Nigeria more than tripled, to 44 pounds a year. Bread has been displacing traditional foods like eba, dumplings made from cassava root.

by David Streitfeld
FOR FULL STORY GO TO:
http://www.nytimes.com/2008/03/09/business/worldbusiness/09crop.html?_r=1&th&emc=th&oref=slogin
The New York Times www.NYTimes.com
March 9, 2008