Dear Reader,
Eric Roseman has discussed the growing global food crisis in the A-Letter recently, but it’s quickly escalating into agricultural Armageddon.
Just last week Kazakhstan, one of the world’s largest grain exporters, imposed a TOTAL ban on wheat exports. In other words, wheat can NOT leave the country. This is just the latest of many desperate attempts to hold down soaring local prices.
Wheat has skyrocketed 92% higher in the past year, but may soar even higher, as export restrictions in Russia, Ukraine and Argentina have closed one-third of the global wheat market.
Meanwhile panic is gripping Asia as rice prices have more than tripled in the past year. Rice is a staple food source for three billion people in developing nations of Asia and Africa. It’s easy to see why there is panic and rioting in the streets. The price of benchmark Thai rice broke through the US$1,000 a ton mark for the first time ever last week, up from just US$300 this time last year.
The escalating food crisis is easily the biggest problem facing Asia and other emerging markets – much more troubling than the credit crunch. After all, people in these nations can do without bank loans or new credit cards, but they can’t stop eating!
Offshore A-Letter