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Tight Credit for Farmers Leads to Smaller Crops, Higher Prices and More Hunger

CEO Blogger (October 28th, 2008) Writes:

Tighter credit for farmers could worsen a global food crisis as smaller crop sizes cause prices to soar. Many farmers have traditionally bought pre-season supplies such as seeds and fertilizer on credit and then paid off the debt with the proceeds from the year’s harvest. But with a growing number of farmers unable to obtain the credit they need, crop yields will suffer.

Global wheat production will likely be 4.4% less next year, Dan Basse, president of AgResource Co. in Chicago, told Bloomberg News. Basse believes the world’s corn and soybean crops will also see declines.

“The credit situation is worrying even the biggest and best farmers,” Brian Willot, a former University of Missouri commodity analyst who now grows soybeans in Brazil, told Bloomberg. “For the financially weak, credit has dried up completely. For the strong, credit has been delayed and interest rates are

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AgResource Co., Archer Daniels Midland Co., Benjamin Senauer, beverage category, beverage prices, bloomberg, Brazil, Brian Willot, Cargill Inc., Chicago, contrarian profits, crop processors, Dan Basse, Ed Schafer, food, food banks, food budgets, Food Crisis, Food Prices, Food stamp enrollment, Market Commentary, Minnesota, Missouri, starvation, U.S. Department of Labor, United States, University of Minnesota, University of Missouri, wall street, World Food Programme

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Tight Credit for Farmers Leads to Smaller Crops, Higher Prices and More Hunger

Money Morning (October 28th, 2008) Writes:

Tighter credit for farmers could worsen a global food crisis as smaller crop sizes cause prices to soar. Many farmers have traditionally bought pre-season supplies such as seeds and fertilizer on credit and then paid off the debt with the proceeds from the year’s harvest. But with a growing number of farmers unable to obtain the credit they need, crop yields will suffer. Global wheat production will likely be 4.4% less next year, Dan Basse, president of AgResource Co. in Chicago, told Bloomberg News. Basse believes the world’s corn and soybean crops will also see declines. “The credit situation is worrying even the biggest and best farmers,” Brian Willot, a former University of Missouri commodity analyst who now grows soybeans in Brazil, told Bloomberg. “For the financially weak, credit has dried up completely. For the strong, credit has been delayed and ...

More »

Tags for this Post:
AgResource Co., Archer Daniels Midland Co., Benjamin Senauer, beverage category, beverage prices, bloomberg, Brazil, Brian Willot, Cargill Inc., Chicago, crop processors, Dan Basse, Ed Schafer, food, food banks, food budgets, Food Crisis, Food Prices, Food stamp enrollment, Market Commentary, Minnesota, Missouri, starvation, U.S. Department of Labor, United States, University of Minnesota, University of Missouri, wall street, World Food Programme

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Brazil Monthly Inflation Falls Back (Slightly) In June

Edward Hugh (July 12th, 2008) Writes:

Brazil's monthly inflation rate slowed slightly in June from May, though prices still registered their second-biggest rise of 2008. On an annual basis inflation rose at the fastest pace since November 2005, underscoring central bank concern about price pressures.The benchmark IPCA consumer price index was up 0.74 percent in June, down slightly from the 0.79 percent increase registered in May, according to the statistics agency IBGE. Annual inflation in June rose to a 31-month high of 6.06 percent.

Slowing inflation may give the the central bank - which the Economist wryly refers to as the new Bundesbank - room to pause on the current pace of rate increases which have seen policy makers push up the so-called Selic rate from a record low 11.25 percent to 12.25 percent this year.