Do you see the significance of these events? Without looking at the global situation, in the US alone we are experiencing major crop losses, untold amounts of necessary topsoil that’s just been washed away, and toxic residue being distributed across a large portion of our “bread basket.” The impact of these events will be long lasting, and yet just a taste of things yet to come.
From: Reuters
The Mississippi River on Friday burst through an earthen levee that may have been weakened by burrowing muskrats, inundating a small Missouri town and adding to woes from disastrous U.S. Midwest flooding that has fueled fears of soaring world food prices.The levee break, the 36th in the last two weeks, sent a torrent of muddy water into Winfield, a town of about 800 north of St. Louis, where officials said about 100 homes and 1,700 acres of crop land would be submerged.
…“It’s a tragic, devastating disaster,” Russ Kremer, a grain and livestock farmer who is president of the Missouri Farmers Union, said of the worst Midwest floods in 15 years.
He said towns like Winfield and hundreds of thousands of acres of prime crop land submerged in the region represent “a complete loss for a lot of people. It will have a significant effect on the market.”
Heavy rains this month have caused more than $6 billion in crop damage in Iowa, Illinois, Indiana, Missouri and Nebraska, a key growing region in the world’s biggest grain and feed exporter, according to the American Farm Bureau Federation.
Corn prices hit a record at the Chicago Board of Trade in overnight screen trading on Friday at $8.25 per bushel in the July 2009 contract, more than double the 40-year average.Fears that as many as 5 million acres of corn and soybeans have been lost to flooding have pushed corn and livestock prices to the record highs.
Corn is the main feed for livestock, is used for ethanol fuel and contributes to hundreds of other food and industrial products throughout the economy.
Before the floods, stockpiles of corn in the United States — which ships 54 percent of all world corn exports — had already been projected to fall to 13-year lows next year.
So the effect on global food prices as U.S. prices rise has alarmed everyone from central bankers to food aid groups.
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