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Despite The Ukraine/Russia Grain Export Agreement, The U.S. And Other Countries Could Face Food Shortages


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2022 Jul 23, 5:25am   564 views  7 comments

by ohomen171   ➕follow (2)   💰tip   ignore  

#foodshortages Yesterday, I was overjoyed that Russia and Ukraine had reached an agreement to allow up to 22 million metric tons of Ukrainian grain to be exported. The New York Times celebrated this agreement this morning.
Barron's Magazine came out with a warning article this morning that big food shortages are going to be a part of our lives for a while. Here is the complete article:
y Lisa BeilfussFollowing
July 22, 2022 2:30 pm ET

Solar farms like this one in Andrews County, Texas, are gobbling up prime farmland. Some observers see a long-term threat to the nation’s food supply.
Matthew Busch/Bloomberg
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As financial markets and media remain focused on recession timing and debate over when the Federal Reserve will flip to cutting interest rates, growing threats to the U.S. food supply—exacerbated by government policy—go underappreciated.

Concerns of a global food shortage have been mounting given the war in Ukraine and the huge amounts of fertilizer, wheat, and other food-related exports that come from that region. Many economists and strategists say a food shortage can’t happen here. After all, the U.S. produces most of its own food and roughly half of domestic land is used for agricultural production, according to the Food and Drug Administration. There are several overlapping reasons, however, why America shouldn’t take a sufficient food supply for granted.

Eva Slatter, a farrier in Emory, Texas, travels from farm to farm to take care of horses’ hoofs and has a small farm of her own. Her neighbor is selling his herd of cows, and a local livestock auction earlier this month brought out more trailers than she had ever seen, with ranchers looking to sell backed up for miles. Record temperatures and the worst drought in more than a decade mean there isn’t grass for the animals to eat, and hay—the alternative—is tough to come by as higher fuel costs make it harder to transport from other states. The cost of hay in her area is around $220 a roll, compared with about $45 in normal times and $120 in a typical drought year, she says.

“None of the ranchers I know want to get out, but they have to,” Slatter says of the livestock liquidation. “Everybody is selling because they can’t feed them, and no one is buying the cows to raise.” That suggests more meat and lower prices in the near term. But the Texas Farm Bureau said in a report this past week that with much of the current breeding herd going to processing plants, calf numbers will fall in years ahead. As Slatter puts it, if everyone sells out of cattle now, what are we going to do later on?

About 250 miles away from Slatter, Stephen Brantley is getting nervous—but for a different reason. Brantley, a longtime banker at Waggoner National Bank in Vernon, Texas, says his bank has been fielding calls lately from farmers approached by solar companies interested in their land. First the companies ask to test the land over about a year, during which time the farmer can continue growing crops such as wheat. Then, if the testing goes well, the solar company either offers to buy the land or lease it for 20 to 30 years.

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The offers are hard to refuse. Farmland often best meets solar-site requirements, and Brantley says solar companies are paying as much as $800 an acre in his area of the wheat belt for leases that last for decades. That’s $512,000 a year for a section of land—640 acres—an attractive lifeline for farmers increasingly strapped by rising input prices and unfavorable weather. There is also a precedent. Wind came in about 15 years ago and turbines proliferated in the area, overall a net positive, Brantley says. But unlike wind, which is less lucrative and can coexist with crops, solar is pretty zero sum. “I know how fast it can happen. I’m afraid this thing might snowball. If solar catches on like wind did, all this cultivated land will go out of production,” says Brantley.

So far solar hasn’t started to really move into the Midwest, where the soil is considered superior, says University of Illinois ag professor Nick Paulson. It makes sense, he says, for solar companies to be more aggressive in a place like Texas given the relative quality of the farmland and more pervasive droughts. Still, Texas and Oklahoma represent about a quarter of planted acres of wheat in the U.S.

One part of the story is that investors have sought farmland as an inflation hedge. Bill Gates, the largest private owner of U.S. farmland, said on social-media platform Reddit earlier this year that his investment group is buying the land. A May report from the Federal Reserve Bank of Chicago said agricultural land values in the region surged 23% in the first quarter from a year earlier as investors bought a rising share of some of the country’s best farmland. Strategic Solar Group, which brokers land, says the high end of the average solar-farm lease is $2,000 an acre.

Another part of the story involves the government’s green agenda. While President Biden’s climate legislation suffered a new setback when Sen. Joe Manchin this month pulled his support, some lawmakers and analysts predict Biden will issue executive actions. To achieve Biden’s goal for 100% clean electricity in the U.S. by 2035, the Energy Department says solar deployment will need to quadruple. Land.com, a marketplace for rural real estate, says generating electricity solely from solar farms would take 13 million acres—or double that to account for energy storage, electric vehicle charging stations, and the necessary increase in electrical infrastructure. Apart from business incentives, government subsidies and tax credits also help explain why solar companies are aggressively seeking land.

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Biden has pushed solar further into the mainstream than ever before, says Texas A&M University law and engineering professor Felix Mormann. There is lots of merit to seeking reduced emissions, cleaner air, and cheaper energy. But, Mormann asks, who ultimately pays for public spending on this scale and who will reap the economic benefits? The flip side of that question: At whose expense will those economic benefits be reaped?

Already, Americans have seen double-digit price increases in food categories this year. In the latest consumer price index report, meats, poultry, fish, and eggs leapt 12% from a year earlier as bread rose 11% and milk increased 16%. That’s occurring as the U.S. Census Bureau has found about a 10th of Americans don’t have enough to eat.

News of a deal between Russia and Ukraine to resume Ukrainian grain exports via the Black Sea should cool some commodity prices. But Paulson at the University of Illinois says falling food-commodity prices may not easily translate to less expensive food, in part because still-high oil makes up such a big portion of U.S. food costs. Given the short supply of domestic oil, together with the impact of severe droughts and the war in Ukraine, the timing of solar’s encroachment on U.S. farmland may be cause for concern.

Write to Lisa Beilfuss at lisa.beilfuss@barrons.com

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1   WookieMan   2022 Jul 23, 5:46am  

ohomen171 says

But Paulson at the University of Illinois says falling food-commodity prices may not easily translate to less expensive food, in part because still-high oil makes up such a big portion of U.S. food costs. Given the short supply of domestic oil, together with the impact of severe droughts and the war in Ukraine, the timing of solar’s encroachment on U.S. farmland may be cause for concern.

We'll have plenty of food here in the states. Most places will be fine, maybe Africa gets hit.

https://www.mylifeelsewhere.com/country-size-comparison/united-states/ukraine

Ukraine is a joke land mass wise in food production if you look at that map and especially where it's located. My region alone dwarfs anything Ukraine is putting out. We'll be fine. All this is, is industries trying to scare you into bumping the prices so they can make more money on things you need. There won't actually be shortages. There will just be shortages of money for the poorer people. That's really the end game. Keeping people poor and making the rich richer.
3   WookieMan   2022 Jul 23, 6:11am  

To stray from the OP, I'm a face guy. Last picture. Girl second in from the right, black boots. The rest have ugly faces in all the other photos and have way too much clown makeup on to "try" to cover up their ugly grills.

I don't date, but I'm not a bag head guy. I wouldn't be that desperate to date a woman that has to paint herself up before going out. Natural beauty without makeup is what I'd look for. Wake up in the morning, she brushes her hair and boom, she's hot. I feel for the guys that deal with high maintenance chicks. Because when you wake up, it's likely ugly as fuck.
4   Tenpoundbass   2022 Jul 23, 6:56am  

You wouldn't know the difference between Homely and Comely, if you were at Trailer Park USA beauty pageant.

The third picture, the girl on the right, She's the only one that looks out of sorts, in a pin up photo.
5   HeadSet   2022 Jul 23, 8:13am  

Al_Sharpton_for_President says






Girl in the middle is really cute. Not bad figure either despite having had a baby. Note the Cesarean scar.
7   RWSGFY   2023 Oct 15, 11:14am  

This thread aged well. Not!

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