For European farmers, the last few years have seen remarkable fluctuations in profitability. When IACS was first introduced, payments were supposed to compensate us for being exposed to lower world prices. But for a few years (because world prices were high) we managed both the payments and the high prices. Of course, it couldn’t last, and grain prices declined until even the most efficient farmers couldn’t make a profit unless they had no rent or mortgage to pay.
Now we have a situation where grain prices have shot up but are highly volatile. Livestock farmers are having a terrible time until meat prices adjust upwards, and most farmers are wondering if higher grain prices are here to stay, or if wall-to-wall planting of wheat will quickly push prices back down to unprofitable levels.
In my opinion, the answer is that if we get a bumper world harvest in 2008, then prices will fall back. But this won’t be to previous low levels because stocks by then will be at record low levels and demand for both food and biofuel will still be rising.
However, what we should all be concerned about is the possibility that the 2008 harvest is really poor due to drought or other extreme weather in major grain growing regions. We would have virtually no carry over stocks to help out and once it becomes obvious that there is not enough food to go around, panic buying, hoarding and speculation would change a difficult situation in to a disaster. While farmers are more than ready for better times, I’m sure none of us don’t want a situation where people are hungry or starving!
In the medium term, the outlook for the consumer is grim due to Read more
- growth of seeds lost previous year
This photo shows weed seed return. What a waste of energy! There are so many threats to future food production that we need to be working now on ways of reducing this waste. The Intact Harvester is one answer. See our intact harvesting videos or the page on our site for more details.
Water shortages are adversely effecting food production in many parts of the world, and are going to get much worse. Two examples have been reported on this week. In Fortune magazine, Daniel Pepper reports from India about falling water levels due to over extraction.
Ground water has been depleted to such an extent that it is devastating the country. A soil and water expert estimates that the energy used to subsidize rice production in the Punjab region costs $381 million a year. He and other experts warn warns that, if unchecked, future drilling will bleed state budgets, parch aquifers, and run farmers out of business.
Meanwhile, Reuters says that the Saudi government has decided to stop all subsidies to agriculture, and aims to rely entirely on imports by 2016.
This is due to fossil aquifers becoming depleted due to the previous policy of self sufficiency when grain was produced regardless of cost. Massive circles of green apeared in the desert as centre pivot irrigation systems were installed. These systems consist of a massive gantry carrying pipes and watering jets that go slowly round in a circle, the pump and well being in the centre.
Saudi became a major food exporter but will now instead become a major importer. As other countries are also changing from exporters to importers, and as big producers such as the US use more grain for biofuel, severe shortages are bound to happen as other threats to food production mentioned in other posts, come in to play.
The United States is a land with bountiful resources of all kinds of minerals, oil and gas reserves, agricultural land and best of all, a well educated, innovative and hard working people. In addition, it has the most powerful armed forces the world has ever seen. But, in my opinion, it is in a worse position to deal with the looming threats of climate change, oil and gas shortages, and Jihadist attacks then any developed country.
How can this be?
America has become incredibly wealthy by exploiting its resources, but most of all, by using lots and lots of energy from finite fossil fuels. In agriculture, Americans were way ahead of the rest of the world in turning oil calories in to food calories. While the rest of the world’s farmers were using the muscle power of horses, oxen and humans to till the land and harvest the crops before world war II, U.S. farmers were introducing tractors and harvesters to the huge field of the grain belt, where they were highly suited. This early mechanisation of farming freed up labour to work in industry. In industry too, Americans were leaders at using fossil energy to increase productivity, with highly mechanised factories using production line methods.
This mechanisation of farming, allowing most of the population to work in manufacturing or service industries is the key to prosperity. Even now, the poverty of a nation can usually be discovered by the proportion of it’s workers still employed in farming. In America today, despite being a big food exporter, only about 2% of the population work in agriculture. In many poor countries, over 75% still work in farming.
So why America the vulnerable?
Americans have become so expert at using fossil fuels to raise living standards that they have developed a system that depends on cheap plentiful and reliable supplies of oil and gas. Unreliable, scarce and very expensive oil and gas are no good.
America had massive reserves of oil and gas, and still does, but the system is now so hungry that about 22 million barrels of oil are used each and every day, about 25% of the world total, when domestic production is only about 7.5 million barrels per day and falling. Each American needs about twice as much oil as each European even though Europeans have a high standard of living. This means that the American system will collapse more easily and completely when the big oil shock comes.
Because petrol (gas) is not heavily taxed in the U.S. there has been no incentive to use fuel efficient cars or to live close to work and shopping. Public transport and trains are not preferred to cars and airplanes and cities are built in locations that would be intolerable without air-conditioned cars, homes and offices. In the best American tradition of free competition, food is produced intensively where the soil and climate are best for that crop and it is then trucked all over the U.S.
I have been on several bus tours to the U.S. and was surprised that close to some big cities there were no fields of potatoes or vegetables. In some areas there are no grazing cattle and then suddenly there are thousands all together on a few acres, crowding under sun shelters, in a district that has no obvious cropping to feed them. Plainly, all the feed is trucked in from where it’s cheapest.
The finite nature of oil, Peak Oil, middle east turmoil, terrorist attacks on oil installations, the possible establishment of an extreme Islamic state covering much of the middle east including nuclear Pakistan, are all threats that have been covered by other posts on this site.
America is so dependent on imported oil and gas that it is more vulnerable to collapse, especially in agriculture, when they are no longer easily available. Because of the events in Iraq and the possibility of nuclear weapons in Iran as well as those in a future radical Pakistan, it may not be easy to use U.S. military might to secure supplies.
Let’s hope that the next administration uses legislation and taxation to reduce dependence on imported oil. At the same time that would help in the battle against that other big threat-climate change.
Has anyone any ideas on how America would react to a severe and prolonged shortage of oil? Please leave a comment.
2 Responses
Buy Famine in the West Printed Book £6.49 +pp
Buy Famine in the West Ebook £2.99
Tags
Log in and feed
Twitter
Archives
Pages
What is Peak Food?
Categories
Intact Harvesting
Blogroll