High wheat price makes farming unsustainable.

 Article  

Desperate UK pig farmers have doubled the usual number of breeding sows they are sending to slaughter to 7,000 a week because they can no longer afford to feed them following a doubling of wheat prices since last summer.

The crisis is affecting both commercial farmers who supply supermarkets, and pedigree farmers, who tend to sell through farm shops.

Jimmy Doherty, owner of the Essex Pig Company and star of the Jimmy’s Farm TV series, has had to slaughter 50 of his 95 rare-breed sows as the cost of feeding them has risen so steeply. “I am busy killing my sows as I can’t afford to feed them. It is very, very difficult at the moment,” said Mr Doherty.

Pig-feed costs at his Pannington Hall Farm have risen from £130 a tonne in January to £225 today. “I’ve slashed my herd to bits. I will go down to a core of around 30 pedigree sows. It is a crisis. It is a very sad thing as people don’t see what is happening and don’t understand,” he said.

Depleting US stockpiles

The U.S. Department of Agriculture on Friday forecast that U.S. wheat inventories will total 272 million bushels by the end of May – the lowest level in more than five decades. Wheat prices have surged 20% since the start of year, pushed higher by growing world demand and bad weather that has pummeled crops in Canada, Argentina and India. U.S. exporters are selling wheat at a record-pace to meet demand, rapidly depleting stockpiles.

Export restrictions spreading

Prices of top-quality wheat jumped 25 per cent to a record high on Monday in their largest one-day increase as Kazakhstan, one of the largest grain exporters, said it would impose export tariffs to curb sales.

The move, which follows similar export restrictions in Russia and Argentina, is likely to put further pressure on already tight global wheat supplies, analysts said.

Akhmetzhan Yesimov, Kazakhstan’s minister of agriculture, said the government wanted to limit exports as it battled against rising domestic inflation of nearly 20 per cent.

Mills and bakers are ”panicking”

The price of spring wheat, used to bake bread, has more than doubled since January and has risen fourfold in the last year, contributing to a rise in global food inflation.

Gavin Maguire, of Iowa Grain in Chicago, said consumers such as mills and bakers, who needed wheat, were “panicking”. He said: “Historical references are useless. We are breaking all the rules.”

Iraq and Turkey said they were planning substantial wheat purchases to replenish inventories and analysts said China could be forced to follow because of drought damage to its next crop.

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Why are food prices rising?

The Financial Times has a comprehensive set of videos and articles that set out to answer your questions as to why we are in the midst of a global food crisis.

See; Why are food prices rising?

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3 Responses to High wheat price makes farming unsustainable.

  1. the Grit says:

    Hi,

    Over here in the US, it’s corn prices that are the problem. It was announced this morning that, although the major food processing companies had previously been eating the increased cost for the grain that our Government has us increasingly devoting to the production of ethanol, they’re in general agreement that this policy can’t continue, and the birds are coming home to roost accompanied by expected food price increases of around %25. It would seem that my fellow Americans are about to learn a lesson about just how widely corn products are incorporated into products they use daily. It would also seem that an investigation into price fixing between some of our large companies is in order.

    On the other hand, it’s good news for grain farmers, and I can’t say I’m altogether put off over the %25 increase in hay prices this year either. Although, I suspect that our local Government is already in conference over the idea of reducing the sales tax to alleviate suffering due to high food prices, and making up the difference with an increase in property tax.

    the Grit

  2. matt says:

    You’re so right. The increase in food prices is about to become a major, major issue. People will be jacking ethanol driven cars to sell them for food. Maybe they will start at drive-in MacDonalds.

  3. the Grit says:

    Hi Matt,

    Naw. All the good cars are parked at StarBucks 😉

    the Grit

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