World 'faces chocolate drought in 2014'

LONDON: The world is facing a chocolate drought ", according to an expert, whose warning is prompted by fears that the globe's sustainable cocoa supplies could be exhausted by 2014.

Political unrest in the Ivory Coast, the source of almost half the world's cocoa beans, has depleted the number of cocoa farmers there. Many have fled the country or are smuggling the crop into Ghana, where it is selling at a far higher price, says British chocolatier Angus Kennedy.

Chocolate makers are now facing the highest cocoa prices for more than 30 years. Prices jumped by 10 per cent this month alone following a curb on international cocoa exports initiated earlier this week by Ivory Coast's President Alassane Ouattara.

Kennedy said that chocolate producers were facing "one of the biggest challenges to hit the industry in recent history".

More at: http://economictimes.indiatimes.com/news....

from agriculture.com:

Quote:

Of all the fundamentals weighing in on the corn and soybean markets lately, the one that's gotten most of the attention is how Mother Nature's behaved in the southern hemisphere, namely the areas of Brazil and Argentina that grow most of South America's soybeans and corn.

As farmers in those countries start to look ahead to harvest, which will begin in parts of South America in the next couple weeks, they're taking stock of where the weather's left their crop potential: Argentina's faced some tough drought conditions throughout the growing season, but recent rains have helped ease that drought pressure. A lot of farmers in Brazil, though, have had good weather lately, and are looking forward to a bumper crop.

Crop conditions in Argentina are looking up. Recent rainfall's helped the nation's drought-stricken corn and soybean belt recover, though some of the driest areas still need more moisture.

The crops are "doing great so far" in the southern state of Parana in Brazil. See how things are shaping up for farmers there, courtesy Luana Gomes of Gazeta do Povo in Parana.

Agriculture.com Marketing Talk member Santiago is a farmer in Argentina who's been dealt a tough hand with his crops this year. His farm in the Cordoba province in the center of the nation has missed out on many of the rains that have fallen there -- especially in the last 2 weeks -- and that's got him worried about his crop prospects as harvest looms.

"If we do not get any [rain this or] next week either, I can say that our soybeans will be in trouble," Santiago said in Marketing Talk this week.

On top of a lack of rainfall in much of his nation, Santiago says the weather's caused other issues, namely with disease. "I had to spray all my soybeans due to disease, and some farmers are doing it for the second time, which as you can imagine, the disease is mainly in dry seasons," he says.

Still, next week holds more chances for rain to fall on Santiago's Cordoba farm and he says he's "still optimistic about still more Argentine rainfall chances for the middle of next week, and the state of Cordoba would certainly be in the mix to get some of the best amounts from that system."

On the other hand, Santiago says "Brazilian weather concerns have been few and far between throughout this growing season and that looks to continue," echoing the reports from reporters like Gazeta do Povo's Luana Gomes. The crops are "doing great so far" in the southern state of Parana in Brazil, for example, Gomes said earlier this week

More at: http://www.agriculture.com/news/crops/so....

Quote:

World 'faces chocolate drought in 2014'

NOOOOOOOOOOOOOOOOOOOOOOOOOOOO !!!!!!!!!!!!!!!!!!!

...better add more chocolate to my preps...

Today's trade may be showing possible reversals in about everything but coffee.
Especially ugly for Sugar and maybe cotton. Possible outside days in corn and beans, too. Fund money rotation to Gold and the Dollar maybe?

We have been sitting above fundamentals for quite some time, it would make sense to see corrections.

The rumours about china's purchases seem to be keeping a floor in these. Guess that Jimai-22 is not quite what the press had described initially.

USDA says 9.4% less corn than they thought? They are never this far off. Meats may not be close but this stuff with the grains is ridiculous. Today's trade and volume will be interesting.......

disclosure. long CZ1

Watch for liquidity vaporization (see ticker). I have played out a liquidity vaporization scenarios for a few years and it is ugly for ag. The ripples could easily swamp ag however coming out the other side it becomes a look the **** out situation.

Getting into this situation in the first place was not advisable, hitting the brakes at this particular point in time can easily get one to worst case scenario.

Especially if the vaporization were to take down banks who hold the deposits of debt free farmers. If the FDIC can not support those deposits then the lack of credit will pale in comparison to the lack of funds that the strong farmers could use to maintain some semblance of a food supply.

That's the real worst case scenario.

Great post on Spring weather effect.

2011 Upper Mississippi flood potential going off-scale in forum [GeoPoliticsNews]

http://tickerforum.org/akcs-www?post=181....

Possible limit up move today because of ending stock numbers...."Very friendly"
Old crop corn numbers not expected.

Weather - terrible and going to start taking its toll on this year's corn crop potential (cold/wet is the worst sort of situation you can face early in the year)

Central Illinois planting, my area, is tough now and the weather is not helping at all. What we used to call "race horse flats" seems to be behind as well.

http://www.zerohedge.com/article/20-sign....

Definitely worth reading.

Quote:

In case you haven't noticed, the world is on the verge of a horrific global food crisis. At some point, this crisis will affect you and your family. It may not be today, and it may not be tomorrow, but it is going to happen. Crazy weather and horrifying natural disasters have played havoc with agricultural production in many areas of the globe over the past couple of years. Meanwhile, the price of oil has begun to skyrocket.

The entire global economy is predicated on the ability to use massive amounts of inexpensive oil to cheaply produce food and other goods and transport them over vast distances. Without cheap oil the whole game changes. Topsoil is being depleted at a staggering rate and key aquifers all over the world are being drained at an alarming pace. Global food prices are already at an all-time high and they continue to move up aggressively. So what is going to happen to our world when hundreds of millions more people cannot afford to feed themselves?

Rice is steady. Apparently the pigmen were given the word not to speculate there.

Here's an interesting little factoid from my operation....My direct purchases of fuel for producing and harvesting a crop are about 85-90 gallons per acre per year. This does not include the fuel costs embedded within the fertilizer, farm chemicals, and spare parts.

The majority of those direct gallon purchases(at least 1/2 of it) are for moving the crop off the farm. Farm crops are bulky and require lots of transportation inputs to get them to market.

http://twitpic.com/4tb2yt
http://twitpic.com/4t9bkk
http://twitpic.com/4t8tj6
http://twitpic.com/4sy6ax

via Country Hedging a CHS parent
http://twitter.com/#!/hedgeit

Well I'm no farmer but those pics don't look too good. The fourth one listed looks ok but I don't know if that crop would normally be much taller by now? I am worried about this as well.No one I know is worried-just me and you guys here.

Canada is a **** show, water everywhere. The most optimistic person I talked to said they would be 2.5 weeks before the tractors would be in the field. South half of china has received half of it's normal rainfall and it is dry through a big swath of europe. Russia still having issues from last year's lack of moisture.

Have a look at who the world's major exporters are and then have a good look at their present situation. This is of a rather serious nature and no one is looking at it right now. Keep in mind that all the financial armageddon stuff has potential to be triggered by the food. As I have been saying the black swan may yet turn out to be a farm raised animal and it would not be the first time in history that has happened.

If things do not turn around right now the opening bell will sound and the game will be on.

Wow, Goodlander. I started googling yesterday when reading the thread about the levee flooding the farms on the Mississippi. And there's more rain coming at the end of the week to the midwest.

U.S. corn planting slowest since 1980s
May 4, 2011 3:51pm

Wet weather has held back corn sowing in the US to its slowest since at least the 1980s, with planting grinding to a halt in some states, and the pace of seedings of other crops too at historically low levels.

US farmers sowed just 4% of their corn crop last week in what is typically one of the busiest weeks of the spring planting season, taking total seedings to 13% of expected acres, US Department of Agriculture data showed.

This was behind market expectations and the 40% typically sown by the beginning of May, with 66% in the ground last year, which had boasted excellent planting conditions – in marked contrast with the heavy rains, and cold, which have held up field work this year.

"The corn planting pace is the slowest since the data was compiled in the 1980s," Ker Chung Yang at Singapore-based broker Phillip Futures said, noting that Illinois, America's second-ranked corn producing state, Indiana and Ohio failed to show any progress.

http://westernfarmpress.com/management/u....

What we are seeing is normal in a historical perspective. We have come through an "abnormally normal" 100 years where temperatures and precipitation in any specific area was about the same every year around the world. If one eliminates the living memory bias out of the history they will see a completely different picture. An average consists of a drought in one spot and a flood in another resulting in an average. Look at the global records up to 1900 then compare them to the patterns in the last century. a bit eye opening.

Yep. People in North America have no idea what the historical climate - even the last 1000 years - is really like.

And here's Europe's drought:

Quote:

Grains Wilt in Dry Europe as England Posts Its Hottest April in 352 Years
By Tony C. Dreibus - May 4, 2011 11:14 AM ET

Dry weather in France and Germany and England’s hottest April in at least 352 years are threatening crops across the European Union, producer of a fifth of the world’s wheat.

About 20 percent of average rain fell in the U.K. in April after a dry March, further reducing soil moisture, the Home- Grown Cereals Authority, an industry group, said in an e-mailed report. European wheat and rapeseed crops are “in jeopardy” after an “incredibly dry” April, according to agricultural weather forecaster Martell Crop Projections.

Dry, warm weather in Europe may reduce global wheat stockpiles already expected to fall 7.6 percent in the year that ends on May 31, the biggest decline since 2007. Food prices reached a record in February, driving 44 million people into poverty, and wheat consumption may rise to an all-time high this year. The world “cannot afford” for Europe’s crop to be diminished, Abdolreza Abbassian, a senior economist at the United Nations’ Food and Agriculture Organization, said last month.

“The world needs a bumper crop in all grains from the U.S. and from Europe and from Canada or we are in trouble,” Dennis Gartman, an economist and author of The Gartman Letter, said today by e-mail. “The winter wheat crop here is in trouble, and the spring wheat crop in the Dakotas and the Canadian prairies may be very badly delayed and therefore in jeopardy.”

Inciting Riots
Feed-wheat futures traded in London almost doubled in the past year and milling-wheat futures gained 91 percent in Paris trading. Prices gained partly after the worst Russian drought in a half-century cut production, causing the government to ban exports of grains. Chicago futures, the world benchmark, rose 55 percent in the past year. Rising prices were partly blamed for inciting riots in north Africa and the Middle East that led to the ouster of presidents in Tunisia and Egypt.

The average temperature in the area covered by the Central England Temperature gauge, an area bound by London, Bristol and Manchester, was 11.8 degrees Celsius (53.24 degrees Fahrenheit) in April, the warmest since record-keeping started in 1659, according to the Met Office.

March was the driest since 1961 in England and Wales, the National Farmers’ Union said in a report today. April’s water reserves were the lowest since 1996 as dry, warm weather persists, the NFU said.

“Some members, particularly in the east of the U.K., have been reporting slow and patchy emergence of spring crops and some signs of water stress developing for winter-sown oilseed******and some winter cereal crops,” the NFU said on its website.

‘Tipping Point’
Wheat and rapeseed in France, Germany and the U.K., the largest wheat producers in the EU, are ready to deteriorate rapidly without rain, Gail Martell, the head of Whitefish Bay, Wisconsin-based Martell Crop Projections, said in an e-mailed report two days ago.

The grains are at an “important tipping point” because stored soil moisture from the winter has been used up, Martell said. The meteorologist said 65 percent of European wheat and 75 percent to 80 percent of rapeseed are in jeopardy.

“Earlier-maturing winter crops are likely to be worst affected without rain, so at the moment that means barley and rapeseed,” Dave Norris, an independent feed broker in Harrogate, England, said today by e-mail. “Spring-planted crops haven’t got off to a good start either, with very little moisture since they got planted, which again means barley and rapeseed.”

Global Stockpiles
Wheat is the EU’s second-largest agricultural export after wine, with an average value of 3.45 billion euros ($5.1 billion) a year from 2008 to 2010, according to the bloc. The 27-nation grouping will produce 136.08 million metric tons of wheat in the year that ends on May 31, USDA data show. Global output will total 647.18 million tons, according to the USDA.

Global wheat stockpiles are expected to fall to 182.8 million tons in the year through May 31, down from 197.9 million a year earlier, USDA data show. World consumption of wheat will total a record 660.8 million tons this year, up 1.6 percent from a year ago, the USDA said.

Drought in the U.S. southern Great Plains also may curb production, boosting prices further and increasing costs for bread and cereal makers. Wheat yields may fall in north-central Kansas and southern Nebraska from a year ago, according to data from the Wheat Quality Council’s annual crop tour.

Yields may average 40 bushels an acre, based on observations from 267 fields collected on the first day of the tour. In 2010, the estimated yield in the area surveyed on the first day was 40.7 bushels, based on 213 observations, council data show. The tour traveled from Manhattan to Colby, Kansas....

more: http://www.bloomberg.com/news/2011-05-04....

I love how they estimate yield already. Are they talking about wheat or rice?