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Earth Policy News – World Grain Stocks Fall to 57 Days of Consumption

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Earth Policy News – World Grain Stocks Fall to 57 Days of Consumption: Grain Prices Starting to Rise Eco-Economy Indicator – GRAIN HARVEST June 15, 2006 Eco-Economy Indicators are the twelve trends the Earth Policy Institute tracks to measure progress in building an eco-economy. Grain production is the best indicator of the adequacy of the food supply. On average, half the calories we consume come directly from grain and a large part of the remainder come from the indirect consumption of grain in the form of meat, milk, eggs, and farmed fish.

This year’s world grain harvest is projected to fall short of consumption by 61 million tons, marking the sixth time in the last seven years that production has failed to satisfy demand. As a result of these shortfalls, world carryover stocks at the end of this crop year are projected to drop to 57 days of consumption, the shortest buffer since the 56-day-low in 1972 that triggered a doubling of grain prices.

World carryover stocks of grain, the amount in the bin when the next harvest begins, are the most basic measure of food security. Whenever stocks drop below 60 days of consumption, prices begin to rise. It thus came as no surprise when the U.S. Department of Agriculture (USDA) projected in its June 9 world crop report that this year’s wheat prices will be up by 14 percent and corn prices up by 22 percent over last year’s. With carryover stocks of grain at the lowest level in 34 years, the world may soon be facing high grain and oil prices at the same time. For entire text see http://www.earthpolicy.org/Indicators/Grain/2006.htm For data see http://www.earthpolicy.org/Indicators/Grain/2006_data.htm

For an index of Earth Policy Institute resources related to Food and Agriculture see http://www.earthpolicy.org/Indicators/Grain/index.htm

And for further reading on food security, see Outgrowing the Earth: The Food Security Challenge in an Age of Falling Water Tables and Rising Temperatures by Lester R. Brown (New York: W.W. Norton & Company, 2005), posted on-line for free downloading or for purchase at http://www.earthpolicy.org/Books/Out/index.htm

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