Good News or Bad News?

I've heard that this year's grain price has collapsed. It means hopefully cheaper animal foods, pastas, and bread again, but with the huge rise in fertilizer/oil/running costs, farmers have been left heavily in the red. I fear that taking subsidies off food production has now placed grain in the same boat as poultry and pork e.g. Boom or Bust. It is doesn't seem a very reliable way to nourish a nation or manage our countryside resource Rolling Eyes

Pel

I suppose it depends which sector you are in, if your a pig or poultry farm good news, as it will be there up year, and for arable it will be a bad year.
Was predictable though, all the farmers who could grow grain, grew it to get the high price of 2007/2008 harvest, but now there is a lot more grain than last year the price will drop, maybe not hugely for this harvest, but perhaps next... dependant on the rest of the world of course.

Cho-ku-ri

Seemingly some 'big boys' down South have decided it won't be viable to grow grain next year due to huge input costs, so haven't ordered seed, and will allow the ground to fallow. Perhaps bio-fuel will get back into political favour? I feel sorry for these guys as they can't plan a season ahead far less long term in the countryside.

Cathryn

Who?

Has it, collapsed? Where do I look for that information?

Cho-ku-ri

http://www.fwi.co.uk/Articles/2008/07/31/111454/wheat-prices-slide-in-cut-throat-market.html

Cathryn

Thanks (I think Wink

)

Treacodactyl

Hopefully land prices will come down a bit and livestock farmers will have a slightly better time? I think it's predictable as the prices seemed to rise too much, too soon and I don't think the changes in subsidies had much to do with it. As for other costs, oil has fallen about 20% in the last couple of weeks from its peak so perhaps fuel costs will fall slightly?

Cho-ku-ri

http://news.bbc.co.uk/1/hi/northern_ireland/7556691.stm Yesterday in Ireland farmers react to a 20% pay cut.

Rob R

Re: Good News or Bad News?

Cho-ku-ri wrote:

I fear that taking subsidies off food production has now placed grain in the same boat as poultry and pork e.g. Boom or Bust. It is doesn't seem a very reliable way to nourish a nation or manage our countryside resource Rolling Eyes

Subsidies only work if they create/redress (depending which way you look at it) a disparity between sectors/crops. It's the same as saving the economy by printing more money. Generally a market rises as quickly as it falls, so investing is a rapidly rising market is riskier but more rewarding if you get it right. Unfortunately it is human nature to 'prospect', wether that is in food or subsidies.

A subsidised market is also a barrier to change, the time frame taken to design, consult & implement a subsidy system generally means that it starts too late & goes on too long to fully achieve its desired effect. The same goes for a larger 'single use' scale of production, which in the end has to manipulated the market, as opposed to responging to it, to survive.

milkmaid

it's swings and roundabouts though ,high prices ment more people planted ,the eastern block have had big harvests ,but if the price falls with imputs rising less people will grow as it will not cover fuel and fert price and the price rises again ,ferts are expensive this year,except fym Wink

,and you have also got to remember when harvests come in and buyers pushing prices down,yep planning ahead is getting harder

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