The Artificially Inflated Price of Food and Gas Can Be Blamed on the Commodities Futures Modernization Act of 2000

The law was that when you bought futures, you had to take delivery. However, in 1991, Goldman Sachs' commodities subsidiary, J. Aron, asked for a waiver, and they got it. And over the years the Commodity Futures Trading Commission [CFTC] handed out 14 other similar exemptions. Then everyone got to do this under the Commodities Futures Modernization Act of 2000, which was signed into law by President Bill Clinton on December 21, 2000. Because of this act, speculators can buy and sell food and crude oil on paper without having to actually take possession of it, thus artificially inflating the price.




According to a 2009 article about the exemption for Goldman Sachs:

Michigan Delegates That It is Legal for Local Governments to Create and Enforce Ordinances Banning Farm Animals from Residential Zones

Michigan Bans Animals On Small Farms?

Governments could ban goats, chickens and even bee hives on properties where there are 13 homes within an eighth of a mile of a livestock property or another home within 250 feet of the property, under the Commission’s ruling. Eighty percent or more of the state lives in non-rural, non-agricultural zoned areas. What was NOT stated at the hearings was the fact that your livestock facility must setback off the road 1500 feet -- this is written in the body of the GAAMP. Also, your own house may or may not count as one of the 13 houses.

May 9, 2014

Off the Grid News - Many Michigan residents will lose their right to keep livestock on their own property due to a new ruling from the state’s Commission of Agriculture and Rural Development.

The Commission ruled April 28 that local governments have the right to ban livestock from any area zoned residential in the state.

The action will “effectively remove Right to Farm Act protection for many urban and suburban backyard farmers raising small numbers of animals,” Gail Philbin of the Michigan Sierra Club told Michigan Live. The Right to Farm Act is a state law designed to protect farmers from nuisance lawsuits and zoning regulations. The Commission ruled that the Right to Farm (RTF) Act does not apply to homeowners who keep small numbers of livestock.

“It’s all ‘Big Farm,’ and it’s ‘Big Farm’ deciding against the little farm,” Kim White, who raises chickens and rabbits, said of the Commission’s vote. “They don’t want us little guys feeding ourselves. They want us to go all to the big farms. They want to do away with small farms and I believe that is what’s motivating it.”
“The Commission is essentially taking sides in the marketplace,” Philbin said.

Bees, Chickens and Goats Now Illegal?

Governments could ban goats, chickens and even bee hives on properties where there are 13 homes within an eighth of a mile of a livestock property or another home within 250 feet of the property, under the Commission’s ruling, Michigan Public Radio reported.

“I believe we have over 100 communities in Michigan who have ordinances on the books against chickens and bees and other things, and they will be able to continue to move forward with those,” Jamie Clover Adams, the director of Michigan’s Department and Rural Development, told Michigan Radio.

The rationale for the Commission’s action is that officials are afraid there would be political pressure to repeal the Right to Farm to Act in order to stop backyard farming, Michigan Radio reported.

Opponents of the rule change have not laid out a course of action yet, although some backyard farmers are considering a legal challenge. Other possible courses of action include legislation in the state legislature and a ballot initiative.

Regulatory Limbo 

Some homesteaders in Michigan could find themselves in a complete regulatory limbo because of the Commission’s action. Blogger, writer and organic farmer Michelle Regalado Deatrick does not know if she’ll be able to keep her livestock, because about half of her 80-acre farm may not be zoned for farm animals.

“We’re building up a mixed production farm, planning to farm during retirement, and we have a permit in hand for a livestock facility,” Deatrick said, “but have waited with building until we were sure of what the GAAMP changes would be. Now we’re having to reconsider our business plans and may sell the farm and buy a farm in a more rural area with definite [Right To Farm] protection, or move to another state that’s more welcoming and protective of small farm rights.”

GAAMP refers to the Generally Accepted Agricultural and Management Practices, a set of guidelines put out by the state of Michigan. The current GAAMP designates many small farms as Category 3 lands where livestock might not be allowed.

“Category 3 sites may be zoned for agriculture, but are generally not suitable for livestock production facilities,” the GAAMP states. “They may be suitable for livestock facilities with less than 50 animal units.”

Another problem is that local governments in Michigan are under no obligation to follow the GAAMP. It is simply a set of guidelines.

Michigan is one of several areas where property owners have had to fight for the right to raise food on their own land. Off the Grid News has reported that property owners in Florida and Quebec have been barred from planting vegetable gardens.

Comments from OffTheGridNews:

"Farms now exist on the whim of a local ordinance.Perhaps a bigger impact this change has is that it reduces (eliminates) the state oversight of the largest agriculture processors, CAFOs. CAFOs are now “self-certifying” for compliance to state and federal rules.The Michigan Department of Agriculture and Rural Development (MDARD) clearly support only corporate agriculture. The director of MDARD has been openly hostile towards the small farmer while at the same time travelling the country and world to promote Michigan Ag. MDARD wants to sell product in China while denying local access to healthy food. Most ironically is that small farming in Michigan is now potentially illegal (criminal) just as the USDA is promoting small farming for local food sourcing under the Farm Bill." - Randy Zeilinger, OffTheGridNews, May 3, 2014

"Fight against the underlying problem…the main problem…the cause of all this nonsense. FIGHT AGENDA 21. Agenda 21 being purposed by the United Nations will take all our freedoms, our land, our rights. They will force us all to give up our properties, and move to metropolis areas to live and work. No personal transportation other than bicycles and your feet. The only people that will live outside the metropolis areas will be the farmers growing our food [on corporate-owed farms]. Everything else will be contained within the metropolis and have to abide by their rules/regulations/government. They work disguised by sustainable/green cloak. They are working thru local governments in underhanded and deceptive manner. All our presidents from 1962 to present have signed on to their plan. If you don’t believe me…look it up on the net…I HATE AGENDA 21 AND WILL DO ALL I CAN TO STOP IT." - Agenda Hater, OffTheGridNews, May 3, 2014

"This is all part of Agenda 21′s ICLEI program. Many states, governors, mayors and municipalities have signed off on this treasonous program. The ones that have are being paid well to do so. This program basically sells out the Constitution in lieu of it’s own Charters and resolutions. This is a United Nations program. The “new world order” everyone’s been gossiping about–this is IT! Read through the law fast and get ready to protest because pretty soon, we’ll lose our rights to everything AND lose our land. Part of this program’s ultimate goal is to ‘stack and pack’ people into tightly grouped high-rise city settlements and BAN people from the majority of the land in the USA claiming it for ‘sustainability.’ Dictating what people can and can’t do on their land is only the beginning!" - EFHerne, Off the Grid News, May 3, 2014

"I live in Michigan and we had a right to have small farms with small animals like chickens, goats, rabbits, and to sell eggs, etc. there can no longer be any bee keepers either. We no longer have that right if there is 13 houses within 1/8 of a mile OR 250 feet from your property line. I agree with the 13 houses ruling but the 250 feet from the property line will hurt a lot of people. That includes property on each side of them, behind them, and across the road. Now my question is: Shouldn’t there should also be a ban on dogs? I mean, they make a barking noise and poop in everyone’s yards!! So what is the difference?? Is this law only because you are providing for your family food to eat and have an outside small building. WAIT UNTIL GOVERNMENT SAYS YOU CAN NO LONGER HAVE A GARDEN EITHER!! You can be sure that is next. Oh, ya, and nobody can have a septic system in the country either. So everybody has to give their home and property to the government and move to the city!! You folks need to read up on the UN Agenda 21 World government Agenda." - Stand 4 right, OffTheGridNews, May 6, 2014

"You need to worry just a tad. this isnt’ happening only in MI, it is happening across the nation. IF they control the guns, you can’t fight back, IF they control the healthcare, you can die, and IF they control the food source, you will be in deep straights. Now this is not a conspiracy theory, check what is happening with AGENDA 21…….the UN’s plan for globalization. Check to see what is happening with ‘the new world order plans……..connect the dots……..there is much to be aware of. And it has nothing to do with what you think………don’t panic get busy and write to your congressman, representative and use your voice." - becky, OffTheGridNews, May 5, 2014

"The Right to Farm Act was designed to prevent new suburbanites living next door to pre-existing farmers in areas where the suburbs grew up around the farm from complaining about the sounds and smells of their food supply living next door. If you move to the country, expect it to look and sound and smell like the country or go elsewhere. It really had nothing to do with the urban areas where people wanted to take their double lot and raise chickens and have a goat (it’s usually against zoning laws). But those 'urban homesteaders' saw the Right to Farm Bill as a means to protect them. If these changes are going to leave the authentic small farmers whose farms predated the surrounding area’s development back where they were, without protection from idiot new suburbanite neighbors and wealthy developers, then those changes need to be cancelled." - Betterhave, OffTheGridNews, May 5, 2014

"It is unfortunate that most people, whether they live in town or out in the country, are all being made to conform to a standard because a hand full of others decide to complain. If you read the rules that have just been passed, you’ll notice that this affects anyone who is zoned residential. Mind you, I live out in the country on a dirt road, bordered on three sides by vast farmed fields. I have one neighbor across the road who owns 15 acres that is farmed as well as a neighbor about a half a mile away that lives on a 30 acre plot. But, because our zoning has been changed to residential recently (and very quietly as no one was notified that this was happening), none of us will have the ability to own even one chicken if these new rules are enforced. If the complainers are allowed to run the show, if law makers run scared of these complainers, and if big agri-business is wiling to throw a bunch of money into the ring to ensure that we are all forced into buying food from them, well, law hasn’t improved our lives, but worsened it beyond repair. There are going to be a lot of people blindsided by this ruling who have lived for many years with the family pet horse, small flock of sheep kept for hand spinning purposes, goats kept for milking, or chickens kept for eggs that will be affected by all of this foolishness as the zoning is changed to conform to someone’s warped sense of controlling the masses. If rules must be put into place to control farming practices for people who live in town or suburban areas, please change the law to focus ONLY on these areas and not the entire State of Michigan.For those of you who do complain over the noisy rooster next door or a stinky manure pile, you have the ability to move away from the noise or the smell much easier than the farm can move the animals, buildings, fencing, equipment, manure compost facilities, etc." - Mousehunter, OffTheGridNews, May 2, 2014

"Let’s do math. There are 5,280 feet in a mile. That means one eighth of a mile is 660 feet – but it would be a square 1/8 of a mile, so 660×660 = 435,600 square feet. There are 43,560 square feet in an acre, so that would be 13 houses spread out over 10 acres. That is not urban. That is 3/4 acre lots – this is suburban type zoning – but here in NJ that would be the ex-burbs. Most suburban NJ communities allow 3 or 4 chickens at the most on a lot that size (no roosters), with 2 acres in many places being required for livestock (like one horse). You can easily have 4 hives (my main business) on 1/4 acre. Many NJ communities have NO regulations regarding animals on private property. So I regard this ruling as being extremely restricting. NJ is actually going in the reverse direction right now – we are the most densely populated state in the USA, but the NJ legislature is expanding right-to-farm." - Leeann, OffTheGridNews, May 2, 2014

"The price of freedom, aside from the greatest sacrifice of lives, is that a neighbor may exercise it in a way that you don’t like. If you can’t own animals on your property you don’t own the land. If you can’t own the land you don’t have freedom. I remember when the Michigan Right to Farm Act was passed. It was passed in response to municipalities growing, suburbia encroaching in on what was farm land and the yuppies that wanted to escape urban blight didn’t like the sound and smell of some farms. The farms were there first, however. I have 2 acres in a city. It’s been in my family for over 40 years. It’s been literal hell to just try to live there. The city has done everything from making me get rid of a tractor or else pour a cement slab for it with a rat wall to mowing down sunflowers, calling them noxious weeds, and the charging me to do it. Do you want freedom or not? If you don’t, you’re an idiot and need to go back to whatever rock you crawled out from under. Go back to living with someone’s foot on your throat." - William Wallace, OffTheGridNews, May 3, 2014

U.S. Food Stamp Program Doubled in the Past Five Years

House rejects farm bill, 62 Republicans vote no

House rejects massive farm bill that would have cut food stamps; 62 Republicans vote no

Chart shows federal food stamp participation since 1969

June 20, 2013

AP - The House rejected a five-year, half-trillion-dollar farm bill Thursday that would have cut $2 billion annually from food stamps and let states impose broad new work requirements on those who receive them.

Those cuts weren't deep enough for many Republicans who objected to the cost of the nearly $80 billion-a-year food stamp program, which has doubled in the past five years. The vote was 234-195 against the bill, with 62 Republicans voting against it.

The bill also suffered from lack of Democratic support necessary for the traditionally bipartisan farm bill to pass. Only 24 Democrats voted in favor of the legislation after many said the food stamp cuts could remove as many as 2 million needy recipients from the rolls. The addition of the optional state work requirements by Republican amendment just before final passage turned away many remaining Democratic votes.

Majority Leader Eric Cantor, R-Va., and No. 2 Democrat Steny Hoyer of Maryland, both of whom voted for the bill, immediately took to the House floor and blamed the other's party for the defeat. Cantor said it was a "disappointing day" and that Democrats had been a "disappointing player."

Hoyer suggested that Republicans voted for the food stamp work requirements to tank the bill.

"What happened today is you turned a bipartisan bill, necessary for our farmers, necessary for our consumers, necessary for the people of America, that many of us would have supported, and you turned it into a partisan bill," he said.

The Senate overwhelmingly passed its version of the farm bill last week, with about $2.4 billion a year in overall cuts and a $400 million annual decrease in food stamps — one-fifth of the House bill's food stamp cuts. The White House was supportive of the Senate version but had issued a veto threat of the House bill.

If the two chambers cannot come together on a bill, farm-state lawmakers could push for an extension of the 2008 farm bill that expires in September or negotiate a new bill with the Senate and try again. Some conservatives have suggested separating the farm programs and the food stamps into separate bills. Farm-state lawmakers have for decades added food stamps to farm bills to garner urban votes for the rural bill. But that marriage has made passage harder this year.

House Agriculture Committee Chairman Frank Lucas, R-Okla., said Thursday that the committee is assessing all its options and will continue its work in the "near future."

Just before the vote, Lucas pleaded with his colleagues' support, saying that if the measure didn't pass people would use it as an example of a dysfunctional Congress.

"If it fails today I can't guarantee you'll see in this Congress another attempt," he said.

Minnesota Rep. Collin Peterson, the senior Democrat on the House Agriculture Committee, said he believes the work requirements and a vote that scuttled a proposed dairy overhaul turned too many lawmakers against the measure.

"I had a bunch of people come up to me and say I was with you but this is it, I'm done," Peterson said after the vote.

House Speaker John Boehner, R-Ohio, voted for the bill but lobbied for the dairy amendment that caused some dairy-state lawmakers to eventually turn on the legislation. Cantor vocally supported the amendment that imposed the work requirements, coming to the House floor just before that vote and the final vote to endorse it.

Though passage has been in the balance all week, the vote against the bill was larger than many expected. When the final vote count was read, House Democrats cheered loudly, led by members of the Congressional Black Caucus who had fought the food stamp cuts.

The defeat is also a major victory for conservative taxpayer groups and environmental groups who have unsuccessfully worked against the bill for years. Those groups have aggressively lobbied lawmakers in recent weeks, hoping to capitalize on the more than 200 new members of the House since the last farm bill passed five years ago. Many of those new members are conservative Republicans who replaced moderate rural Democrats who had championed farm policy.

Those groups were emboldened after the vote.

"We need to put farm subsidies on a path to elimination and we need to devolve food stamps to the state level where they belong," said Chris Chocola, president of the conservative advocacy group Club for Growth.

Thailand Responding to the Global Food Crisis by Raising Bugs for Eating

Thailand urged to explore edible insect market

May 21, 2013

AP - Researchers say Thailand is showing the world how to respond to the global food crisis: by raising bugs for eating.

The United Nations' Food and Agricultural Organization released a study and handbook Tuesday on what they call 'six-legged livestock' — edible bugs and worms that can help meet global food demand that is expected to grow 60 percent by 2050. The agency says they provide a rich source of protein, vitamins and minerals.

The study was conducted in Thailand, where insects including crickets, grasshoppers and bamboo worms have long been a part of diets, especially in rural areas.

Entomologist Yupa Hanboonsong says about 200 insect species are eaten in Thailand. Cricket farming alone is already a $30 million industry there, but only a few other species have been commercially marketed.

Insects are U.N.'s New Weapons to Fight Hunger

UN: Eat more insects; good for you, good for world

 
 This Feb. 20, 2008 photo provided by the United Nations Food and Agriculture Organization (FAO) shows insects for sale at a market in Chiang Mai, Thailand.

May 13, 2013

AP - The latest weapon in the U.N.'s fight against hunger, global warming and pollution might be flying by you right now.

Edible insects are being promoted as a low-fat, high-protein food for people, pets and livestock. According to the U.N., they come with appetizing side benefits: Reducing greenhouse gas emissions and livestock pollution, creating jobs in developing countries and feeding the millions of hungry people in the world.

WHO EATS INSECTS NOW?

Two billion people do, largely in Asia, Africa and Latin America, the Rome-based U.N. Food and Agriculture Organization said Monday as it issued a report exploring edible insect potential.

Some insects may already be in your food (and this is no fly-in-my-soup joke). Demand for natural food coloring as opposed to artificial dyes is increasing, the agency's experts say. A red coloring produced from the cochineal, a scaled insect often exported from Peru, already puts the hue in a trendy Italian aperitif and an internationally popular brand of strawberry yogurt. Many pharmaceutical companies also use colorings from insects in their pills.

PACKED WITH PROTEIN, FULL OF FIBER

Scientists who have studied the nutritional value of edible insects have found that red ants, small grasshoppers and some water beetles pack (gram-per-gram or ounce-per-ounce) enough protein to rank with lean ground beef while having less fat per gram.

Bored with bran as a source of fiber in your diet? Edible insects can oblige, and they also contain useful minerals such as iron, magnesium, phosphorous, selenium and zinc.

WHICH TO CHOOSE?

Beetles and caterpillars are the most common meals among the more than 1,900 edible insect species that people eat. Other popular insect foods are bees, wasps, ants, grasshoppers, locusts and crickets. Less popular are termites and flies, according to U.N. data.

ECO-FRIENDLY

Insects on average can convert 2 kilograms (4.4 pounds) of feed into 1 kilogram (2.2 pounds) of edible meat. In comparison, cattle require 8 kilograms (17.6 pounds) of feed to produce a kilogram of meat. Most insects raised for food are likely to produce fewer environmentally harmful greenhouse gases than livestock, the U.N. agency says.

DON'T SWAT THE INCOME

Edible insects are a money-maker. In Africa, four big water bottles filled with grasshoppers can fetch a gatherer 15 euros ($20). Some caterpillars in southern Africa and weaver ant eggs in Southeast Asia are considered delicacies and command high prices.

Insect-farms tend to be small, serving niche markets like fish bait businesses. But since insects thrive across a wide range of locations — from deserts to mountains — and are highly adaptable, experts see big potential for the insect farming industry, especially those farming insects for animal feed. Most edible insects are now gathered in forests.

LET A BUG DO YOUR RECYLING

A 3 million euro ($4 million) European Union-funded research project is studying the common housefly to see if a lot of flies can help recycle animal waste by essentially eating it while helping to produce feed for animals such as chickens. Right now farmers can only use so much manure as fertilizer and many often pay handsome sums for someone to cart away animal waste and burn it.

A South African fly factory that rears the insects en masse to transform blood, guts, manure and discarded food into animal feed has won a $100,000 U.N.-backed innovation prize.
___
Details about the U.N. Food and Agriculture Organization's work on edible insects at www.fao.org/forestry/edibleinsects

Lines Grow Outside Iran's Shops as Food Prices Rise Under International and Western Sanctions Over Tehran's Disputed Nuclear Program

Food price hikes raise concerns in Iran

April 22, 2013

AP - Iranians lined up to buy cooking oil and meat in Tehran on Monday, as price hikes threatened to stir discontent less than two months before presidential elections. 

Prices of staples such as imported cooking oil, chicken and red meat have jumped up to 60 percent since authorities decided last week to increase the official dollar exchange rate for importers who need the currency to do business. They now pay 24,500 rials for $1, nearly double the previous rate of 12,260. 

Iran's economy is flagging under international and Western sanctions over Tehran's disputed nuclear program. The West suspects the program could lead to production of weapons, but Iran denies the charge. The sanctions, which include an oil and banking embargo, have led to a shortage of foreign currency and drastically cut the government's income, while the country's persistent inflation eats into consumer buying power.

Despite government assurances that the new rate will go not go into effect for several weeks, many people are stocking up on goods before prices rise even more. The government has banned prices hikes until the new measures are in place and dispatched inspectors to keep tabs on businesses.

"Any price rise is illegal," said Mojtaba Farahani, an official in the Commerce Ministry. "So far a remarkable number of reports have been filed about wholesale and retail shops," he told the semiofficial ISNA news agency.

In Tehran, stores were crowded with people rushing to beat the hikes. In one grocery, homemaker Neda Rahimi quickly scooped up the last three bottles of cooking oil left on the shelves.

"Everyday prices are going higher and higher. I will take these for now, so I have some extra at home," said the mother of two.

In another shop, 48-year-old high school teacher Asghar Niazi said a government announcement in March to raise public sector wages had encouraged stores to raise prices.

"Now every shop has hiked its prices up more than 20 percent. I was here to buy cooking oil, but people snapped it all up before I arrived."

Frustration over the price hikes has resonated in Iran's tightly controlled media, which has grown increasingly critical of the government over the past year for the surge in costs for milk, chicken, rice and locally made cars.

On Monday, a string of newspapers warned that the new currency rules could add to restlessness ahead of the June 14 election to select a successor to President Mahmoud Ahmadinejad.

The commentaries, which came from across the political spectrum, suggest disputes within the country's closed ruling system. Even the influential conservative daily Kayhan, which often supports the policies of Iran's ruling clerics, referred to "hidden hands" working from behind the scenes to provoke discontent.

The more moderate Hamshahri newspaper ran a front page article focusing on "expanding" prices, accusing officials of trying to "downplay" their effects. Another daily, Haft-e Sobh, reported traffic jams in front of major stores because of long lines of customers rushing to make last-minute purchases.

Prices for local products are also rising, although at a slower rate. While in Tehran a liter of imported cooking oil has jumped to around 100,000 rials from about 60,000, the domestically produced version now costs 34,000 rials, compared to 27,000 rials two weeks ago. 

Price rises for locally produced products that have become the mainstay of much of the country are likely to generate more concern among policymakers, especially since even the prices of basics, like bread, are becoming less stable. Last week, Deputy Commerce Minister Abbas Ghobadi said prices of bread "will definitely go higher."

U.S. Drought Worsens After Weeks of Improvement

US drought worsens after weeks of improvement

November 21, 2012

AP - The worst U.S. drought in decades has deepened again after more than a month of encouraging reports of slowly improving conditions, a drought-tracking consortium said Wednesday, as scientists struggled for an explanation other than a simple lack of rain.

While more than half of the continental U.S. has been in a drought since summer, rain storms had appeared to be easing the situation week by week since late September. But that promising run ended with Wednesday's weekly U.S. Drought Monitor report, which showed increases in the portion of the country in drought and the severity of it.

The report showed that 60.1 percent of the lower 48 states were in some form of drought as of Tuesday, up from 58.8 percent the previous week. The amount of land in extreme or exceptional drought — the two worst classifications — increased from 18.3 percent to 19.04 percent.

The Drought Monitor's map tells the story, with dark red blotches covering the center of the nation and portions of Texas and the Southeast as an indication of where conditions are the most intense. Those areas are surrounded by others in lesser stages of drought, with only the Northwest, Florida and a narrow band from New England south to Mississippi escaping.

A federal meteorologist cautioned that Wednesday's numbers shouldn't be alarming, saying that while drought usually subsides heading into winter, the Drought Monitor report merely reflects a week without rain in a large chunk of the country.

"The places that are getting precipitation, like the Pacific Northwest, are not in drought, while areas that need the rainfall to end the drought aren't getting it," added Richard Heim, a meteorologist with the National Oceanic and Atmospheric Administration's National Climatic Data Center. "I would expect the drought area to expand again" by next week since little rain is forecast in the Midwest in coming days.

He said there was no clear, scientific explanation for why the drought was lingering or estimate for how long it would last.

"What's driving the weather? It's kind of a car with no one at the steering wheel," Heim said. "None of the atmospheric indicators are really strong. A lot of them are tickling around the edges and fighting about who wants to be king of the hill, but none of them are dominant."

The biggest area of exceptional drought, the most severe of the five categories listed by the Drought Monitor, centers over the Great Plains. Virtually all of Nebraska is in a deep drought, with more than three-fourths in the worst stage. But Nebraska, along with the Dakotas to the north, could still see things get worse "in the near future," the USDA's Eric Luebehusen wrote in Wednesday's update.

The drought also has been intensifying in Kansas, the top U.S. producer of winter wheat. It also is entirely covered by drought, and the area in the worst stage rose nearly 4 percentage points to 34.5 percent as of Tuesday. Much of that increase was in southern Kansas, where rainfall has been 25 percent of normal over the past half year.

After a summer in which farmers watched helpless as their corn dried up in the heat and their soybeans became stunted, many are now worrying about their winter wheat.

It has come up at a rate on par with non-drought years, but the quality of the drop doesn't look good, according to the USDA. Nearly one-quarter of the winter wheat that germinated is in poor or very poor condition, an increase of 2 percentage points from the previous week and 9 percentage points worse than the same time in 2011. Forty-two percent of the plantings are described as in fair shape, the same as last week.

Farmers who might normally irrigate in such circumstances worry about low water levels in the rivers and reservoirs they use, and many are hoping for snow to ease the situation. But it would take a lot. About 20 inches of snow equals just an inch of actual water, and many areas have rain deficits of a foot or more.

Brokers are Gathering Up Discarded Food Products and Putting Them Out for the Highest Bid to Feed Lot Operators and Dairy Producers, Who are Scrambling to Keep Their Animals Fed

Sweet Times for Cows as Gummy Worms Replace Costly Corn Feed

September 23, 2012

Reuters - Mike Yoder's herd of dairy cattle are living the sweet life. With corn feed scarcer and costlier than ever, Yoder increasingly is looking for cheaper alternatives -- and this summer he found a good deal on ice cream sprinkles.

"It's a pretty colorful load," said Yoder, who operates about 450 dairy cows on his farm in northern Indiana. "Anything that keeps the feed costs down."

As the worst drought in half a century has ravaged this year's U.S. corn crop and driven corn prices sky high, the market for alternative feed rations for beef and dairy cows has also skyrocketed. Brokers are gathering up discarded food products and putting them out for the highest bid to feed lot operators and dairy producers, who are scrambling to keep their animals fed.

In the mix are cookies, gummy worms, marshmallows, fruit loops, orange peels, even dried cranberries. Cattlemen are feeding virtually anything they can get their hands on that will replace the starchy sugar content traditionally delivered to the animals through corn.

"Everybody is looking for alternatives," said Ki Fanning, a nutritionist with Great Plains Livestock Consulting in Eagle, Nebraska. "It's kind of funny the first time you see it but it works well. The big advantage to that is you can turn something you normally throw away into something that can be consumed. The amazing thing about a ruminant, a cow, you can take those type of ingredients and turn them into food."

PRICING VARIES

Feed is generally the largest single production expense for cattle operators. Whatever is fed needs to supply energy and protein levels that meet the animals' nutritional needs. High prices for soy has operators seeking alternatives for both corn and soy.

Corn alternatives are in particular demand as supplies are so tight that in some areas of the country, feed corn is not available at any price.

Pricing and availability of the many different "co-products" as they are called, varies from place to place, but buyers report savings of 10 percent to 50 percent.

The savings for operators are shrinking, however, as savvy resellers tie pricing for their alternative offerings to the price of corn, which surged to record highs this summer due to drought damage.

The U.S. Department of Agriculture said last month the harvest now underway will yield the smallest corn crop in six years due to the drought that is still gripping more than half of the nation.

"They are using less corn in a number of these rations, but as corn prices go up, prices for really every other co-product go up too," said Greg Lardy, head of the animal sciences department at North Dakota State University.

Operators must be careful to follow detailed nutritional analyses for their animals to make sure they are getting a healthy mix of nutrients, animal nutritionists caution. But ruminant animals such as cattle can safely ingest a wide variety of feedstuffs that chickens and hogs can't.

The candy and cookies are only a small part of a broad mix of alternative feed offerings for cattle. Many operators use distillers grains, a byproduct that comes from the manufacture of ethanol. Other common non-corn alternatives include cottonseed hulls, rice products, potato products, peanut pellet.

Wheat "middlings," a byproduct of milling wheat for flour that contain particles of flour, bran, and wheat germ, also are fed.

And every now and then, there is a little chocolate for the hungry cows.

Hansen Mueller Grain out of Omaha, Nebraska, which markets chocolate bars alongside oats and peanut pellets, said it all comes down to fat, sugar and energy.

"That's all it is," said Bran Dill, a spokesman at Hansen Mueller. Demand is high, he said.

But he also said increasing prices are making alternatives less attractive.

"The price of this stuff has gone up so much it's gotten ridiculous," he said.

18 Million U.S. Households Struggling to Feed Families

18 Million U.S. Households Struggling to Feed Families

September 5, 2012

The Lookout - Almost 18 million American homes struggled to find enough to eat in 2011, including 3.9 million homes with children, or 10 percent of all families with children, according to numbers released Wednesday by the U.S. Department of Agriculture

Even worse off were single moms and black and Latino households, the survey found.

As NPR notes, "People went hungry."

The survey tracked families who had some issues with finding enough food, dubbed "food insecure," and those deemed "very very food insecure," who lacked basic nutrition at some point during the year. The latter category includes some 6.8 million households nationwide where adults skipped meals, couldn't afford balanced meals, and worried about having enough money to buy food several months out of the year.

In all, the "food insecure" represented 5.7 percent of American households. It's not much of a change compared to 2010, but it's 2 percent more — thousands of people more — since 1998.

[Related: Going hungry in America]

The survey results come just a day after the same agency announced that food stamps — known officially as the Supplemental Nutrition Assistance Program -- reached an all-time high in the U.S. in June, with more than 46 million Americans using help to buy food. Food stamps also reached an all-time high annual cost of $75.7 billion for the fiscal year ending in Sept. 2011, according to Bloomberg News. Almost half of those on food stamps are children.

Meanwhile food stamps and other assistance programs have taken center-stage in the national political debate leading up to the presidential election.

A spokesperson for Republican presidential nominee Mitt Romney told Bloomberg that the increase in food stamps is a sign that the country is not better off than it was four years ago. And during primary season, then-GOP candidate Newt Gingrich lashed out at Barack Obama as the "food stamp President."

"It's one more example of government incompetence," Alabama Republican Sen. Jeff Sessions told Bloomberg.

At the Democratic National Convention in Charlotte, N.C., this week, Rep. Barney Frank told The Daily Caller that there would be fewer people on food stamps if the Republicans cooperated more with stimulus spending, and the Rev. Jesse Jackson said that food stamps help farmers and grocery businesses.

"It's why I wish we got more cooperation from the Republicans in trying to do the things that would help us economically like not have the cities have to layoff firefighters and cops," Rep. Frank, D-Mass., said.

"Providing a safety net for the needy is morally correct and when the economy gets better, those numbers will go down," Jackson said.

Between 2003 and 2008, the Amount of Speculative Money in Commodities Grew from $13 Billion to $317 Billion, an Increase of 2,300 Percent

We may never know for sure the combination of circumstances that brought on the energy crisis of 2008. But one factor was almost certainly the Commodity Futures Modernization Act of 2000, which allowed unprecedented levels of speculation in oil futures by investment banks and pension funds, bringing the familiar boom-bust cycle home to the gas pump. - Drill Now? Try Regulate Now., Wall Street Journal, April 7, 2010

And what caused the huge spike in oil prices? Take a wild guess. Obviously Goldman had help — there were other players in the physical-commodities market — but the root cause had almost everything to do with the behavior of a few powerful actors determined to turn the once-solid market into a speculative casino. Goldman did it by persuading pension funds and other large institutional investors to invest in oil futures — agreeing to buy oil at a certain price on a fixed date. The push transformed oil from a physical commodity, rigidly subject to supply and demand, into something to bet on, like a stock. Between 2003 and 2008, the amount of speculative money in commodities grew from $13 billion to $317 billion, an increase of 2,300 percent. By 2008, a barrel of oil was traded 27 times, on average, before it was actually delivered and consumed. - Matt Taibbi, The Great American Bubble Machine, Rolling Stone, July 2, 2009

We'll Make a Killing Out of Food Crisis, Glencore Trading Boss Chris Mahoney Boasts

August 23, 2012

The Independent - The United Nations, aid agencies and the British Government have lined up to attack the world's largest commodities trading company, Glencore, after it described the current global food crisis and soaring world prices as a "good" business opportunity.

With the US experiencing a rerun of the drought "Dust Bowl" days of the 1930s and Russia suffering a similar food crisis that could see Vladimir Putin's government banning grain exports, the senior economist of the UN's Food and Agriculture Organisation, Concepcion Calpe, told The Independent: "Private companies like Glencore are playing a game that will make them enormous profits."

Ms Calpe said leading international politicians and banks expecting Glencore to back away from trading in potential starvation and hunger in developing nations for "ethical reasons" would be disappointed.

"This won't happen," she said. "So now is the time to change the rules and regulations about how Glencore and other multinationals such as ADM and Monsanto operate. They know this and have been lobbying heavily around the world to water down and halt any reform."

Glencore's director of agriculture trading, Chris Mahoney, sparked the controversy when he said: "The environment is a good one. High prices, lots of volatility, a lot of dislocation, tightness, a lot of arbitrage opportunities.

"We will be able to provide the world with solutions... and that should also be good for Glencore."

Glencore announced pre-tax global profits of £1.4bn. The G20 is considering holding an emergency summit on the world food crisis.

Oxfam was scathing about Glencore's exploitation of volatile world food prices. Jodie Thorpe, from the aid agency's Grow Campaign, said: "Glencore's comment that 'high prices and lots of volatility and dislocation' was 'good' gives us a rare glimpse into the little-known world of companies that dominate the global food system."

Oxfam said companies like Glencore were "profiting from the misery and suffering of poor people who are worst hit by high and volatile food prices", adding:

"If we are going to fix the ailing food system then traders must be part of the cure."

Stephen O'Brien, Parliamentary Under Secretary of State for International Development, said:

"We know that food-price spikes hit the poorest hardest. Ensuring the poor can still access enough food is vital in times of food-price rises, which is why the UK is investing in safety nets that deliver food and cash to the poorest."

A Glencore spokesperson said: "Regardless of the business environment, Glencore is helping fulfil global demand by getting the commodities that are needed to the places that need them most."

Price of a Bushel of Corn has Risen Over 60% in the Last Couple of Months

Drowning in a Sea of Drought

August 22, 2012

empressofaiken - We just paid $2.25 more for a bag of horse feed than we did a month ago – a jump of over 25%. We weren’t happy about, but we only have three horses, so we’ll find a way to work it into the household budget.

What was hard to watch was the dairy farmer who had come to make his regular weekly purchase of 200 bags of feed for his cows. He simply didn’t have the extra $450. Over the course of a month that means another $2,000 to him. It isn’t in his budget, and he had to tell the men at the loading dock to remove some of the bags. He said that he was going home to talk to his wife about how they were going to deal with their herd. He has only two real options – sell some of his cows or slaughter them. He can’t make ends meet selling milk if feeding his cows will eat up every bit of his profit and more. He’s not the only farmer making hard decisions. It’s happening all across the country.

I think it took that scene at the supply store to make this Summer’s weather conditions a reality for me.  

There just isn’t going to be enough corn – not for us, not for livestock or poultry and not for fuel – not unless we do something about it.

In the last couple of months the price of a bushel of corn has risen over 60% from $5.51 per bushel to today’s price which is hovering around $8.40. Take a look at the agricultural commodities market and you’ll see that soybeans have risen from $10.95 to $17.34 and that wheat is up to $9.42 from $5.78.

Given the very basic and simple rules of supply and demand, this means that all of us are going to have to take a long hard look at our checkbooks. We’re going to have to find ways to pinch those pennies a little tighter while we shop for food and fill our gas tanks.

The crops for 2012 are yielding approximately 15-20% less than in previous years and they can’t be recovered. You can’t make something grow without a little help from Mother Nature, and the growing season is quickly coming to an end.

Climatologists are reporting that this is the first of many signs that global warming is a real threat to our planet. That may very well be, but it isn’t just the severe drought conditions that are driving those prices.

• Government regulations require that 40% of corn crops be converted into biofuel, forcing farmers to devote less and less land to growing other crops.
• Market speculators, seeing huge investor profits, have nearly tripled their trading in agricultural commodities, and that was only between June and July. Profit driven motives, in the world of trading, can skew everything and throw the supply and demand model right out the window.
• Fears over war between Israel and Iran, along with the ongoing fighting in Syria, have forced some of their neighbors in the Middle East to stockpile both food and oil supplies.
• China and Japan are facing their own fears and are responding by releasing some of their own grain reserves, impacting the normal flow of global exports and imports.

It has all the makings of the perfect storm for a world that is already skittish about the economic situation.

Here in the United States, there has been some talk by members of Congress about easing up on those ethanol regulations. The United Nations’ Food and Agriculture Organization has appealed for the suspension of the EPA requirements. It’s a sort of food-or-fuel debate. The problem is that it probably won’t happen until 2013, and that’s being optimistic. The ethanol and fuel oil producers have already set the wheels in motion for business as usual. To change their operations will take time.

The debate in Washington, like almost everything else there, is sharply divided and being argued in the two different languages of partisan politics, something that even a translator can’t help. We also have to take into account that we’re in an election cycle, and few candidates are willing to take on any challenge that could very well mean a loss of campaign contributions.

Groups with very diverse interests – from the National Cattlemen’s Association to the Corn Grower’s Association to myriad environmental organizations – have been whispering in the ears of lawmakers and writing checks to ensure that they can be heard.

Should those in power decide to enter into some real discussions and make actual changes to the ethanol issue, there is a very good chance that the situation could improve. Economists and experts in both the fields of energy and agriculture have offered some suggestions as to how different scenarios could work. Each variation shows what type of impact there would be given how much or how little the EPA standards are relaxed.

The other variables, according to an article presented by Purdue University, would be “the price of oil, the price of corn, the magnitude of the drought, the economics of switching away from ethanol and the technical flexibility of refiners and blenders.”

Even a compromise, from all involved, would be better than just doing nothing. These are actual ways in which the further harm to the environment would be limited, while also allowing for Americans to buy groceries and drive to work.

In the meantime, while they’re either arguing or ignoring the problem, we’ll be waiting and prices will keep going up. We might have to tighten our belts another notch, but that won’t be hard, because we’ll probably be eating less and walking more.

The Dust Bowl All Over Again? Midwest Drought Reveals Indiana ‘Ghost Towns’

Is there anyway we can submerge Washington DC?

Midwest Drought Reveals Indiana ‘Ghost Towns’

August 20, 2012

NBC News - The severe drought scorching much of the nation's Midwest has lowered water levels so drastically that towns that were intentionally submerged decades ago are starting to surface.

The historic drought has dried the Salamonie River in northeast Indiana so much that its receding banks are now revealing the remnants, bricks and foundations of Monument City, Ind., NBC News reports.

The small town of 100 was one of three whose residents were relocated before the Salamonie River was dammed and the municipality submerged in order to build a reservoir in 1965.

[Photos: Drought strikes many states]

"Our school didn't have a gymnasium," Dick Roth, 81, who attended the defunct high school in Monument City said in the piece. "Our gymnasium was outside, which is a cement slab."

Slabs of foundations and red bricks that once walled the homes and buildings of the riverside community are becoming visible and bringing up memories for those who once lived there, like Roth.

Officials of a nearby visitor's center that has a display honoring the once-sunken towns are giving guided tours of the areas, hoping former residents will come and tell more stories and share their oral history, NBC noted.

[Related: Drought diaries, stories from the historic drought]

The drop of water levels in lakes and rivers is a startling example of the toll of the historic drought, which is also hampering the economy in the Midwest.

A recent report says the drought is leveling off in the Midwest. However, it's not much consolation with about 62 percent of the continental U.S. mired in drought conditions. About 24 percent of the U.S. is experiencing extreme or exceptional drought—the two worst classifications.

Food Price Spike Due to Drought Could Trigger Riots in Poorer Countries Like in 2008

World Powers Eye Emergency Food Meeting; Action Doubted

August 15, 2012

Reuters - Leading members of the Group of 20 nations are prepared to trigger an emergency meeting to address soaring grain prices caused by the worst U.S. drought in more than half a century and poor crops from the Black Sea bread basket.

France, the United States and G20 president Mexico will hold a conference call at the end of August to consider whether an emergency international meeting is required, aiming to avoid a repetition of the food price spike that triggered riots in poorer countries in 2008.

Yet even as the third grain surge in four years stirs new fears about food supply and inflation, many say the world's powers are no better prepared to rein in runaway prices. Apart from a global grain database, which has yet to be launched, and the Rapid Response Forum that authorities are considering convening for the first time, the G20 has few tools.

Instead, it must intervene through influence, perhaps urging the United States to relax its ethanol policy in response to the crisis - difficult only months before a presidential election that may be won or lost in Midwest farm states - or urging Russia not to impose an export ban, as it did two years ago.

"Beyond words, expect little from the G20 on rising food prices," said Simon Evenett, a former World Bank official who is now professor of international trade and economic development, University of St. Gallen, Switzerland.

He described the G20's record on trade as "feeble."

"With a string of broken promises on protectionism, no serious enforcement, monitoring well after the horse has bolted, and a tendency to pull their punches, any G20 promises on food trade won't be taken seriously - by the G20 themselves or by anyone else."

The group is hindered by the widely differing views of its diverse members, split between big consumers and producers.

A senior Brazilian government official said that only a major food crisis would raise pressure on the G20 to call for intervention in physical commodity markets, something countries such as the United States and Canada typically oppose.

"If we do have a meeting, I don't think we can have anything more than a recommendation coming out of it," said the official who declined to be named because he was not allowed to speak publicly. "The forum has no powers to impose certain policies or decisions on its members."

Benchmark Chicago corn rose to an all-time high on Friday after the U.S. Department of Agriculture cut its production estimate 17 percent.

The United States uses 40 percent of its corn crop to produce ethanol, drawing criticism for using food for fuel when hunger is widespread in some poorer countries.

"They (G20) might talk about the U.S. ethanol mandate requirements, but I don't see them making any massive responses at the moment. They don't have a lot of tools at their disposal," said analyst Muktadir Ur Rahman Of Capital Economics.

The U.N.'s food agency stepped up pressure on the United States on Friday to change its biofuel policies, arguing it was more important to grow crops for food rather than fuel.

The U.N. Food and Agriculture Organisation's food index jumped 6 percent in July to higher than in 2008 and the FAO warned against the kind of export bans, tariffs and buying binges that worsened the surge four years ago.

EU BIOFUELS VERSUS FOOD

The European Commission has also faced extensive criticism of its biofuel policy for using land otherwise devoted to food crops. Scientists have also argued that the policy fails to achieve its environmental goals.

A French agriculture ministry official said countries on the conference the call would decide whether to convene the first meeting of the Rapid Response Forum. The body was created last year to promote early discussion among decision-makers about abnormal market conditions, with the aim of avoiding unilateral action.

"If the situation requires it, a meeting of the Rapid Response Forum could be called as soon as the start of September," the official said, adding that the forum could hold its discussions in person or by a conference call.

A Commission spokesman said its agriculture department was "following the situation on a daily basis" and that the Commission would be involved should the G20's Rapid Response Forum decide to meet.

"Silos are full. There are absolutely no shortages in Europe," he added.

Joseph Glauber, chief economist at the U.S. Department of Agriculture, echoed this view.

"The good news is that global wheat and rice stocks are more plentiful than in 2007/08, but less corn and soybean meal means more wheat feeding (to livestock)," he said.

Glauber said there had been "discussions" about possibly convening a Forum meeting at the same time as a regularly planned gathering in October.

BIOFUEL PRESSURE RISES

Charity Oxfam is among the groups campaigning for ministers to agree on beginning to abolish mandates and targets for biofuel production both in the EU and in the United States.

"In 2011, 11 intergovernmental agencies produced a report to the G20 where it unequivocally said there was a link between increasing biofuels production and food price rises and recommended quite clearly that biofuels mandates and targets should be scrapped," said Hannah Stoddart, head of economic justice at Oxfam Great Britain.

France, the United States and Mexico will discuss a report on agricultural prices requested by France last month and compiled by the Agricultural Market Information System (AMIS). This system, created last year under France's presidency of the G20, is designed to share information on crop prices with a view to averting a repetition of the 2008 food crisis.

France currently presides over both the forum and the AMIS system, which is based at the FAO in Rome. The United States will take the reins in October.

"France ... and the United States remain attentive to any new fact that could justify a meeting of the Rapid Response Forum," French Agricultural Minister Stephane Le Foll said in a statement on Monday.

The forum has no power to impose binding decisions on member states, but it is hoped that discussion can discourage countries from taking unilateral action.

Russia banned grain exports for almost a year after a severe drought two years ago. Weather problems this year have fueled speculation it could resort to export curbs again. However, French officials have said that Russia has given reassuring indicators in contacts through the AMIS system.

"The aim is to talk about the situation and avoid measures like export embargoes, which would be damaging for everyone," the French official said.

Low Levels on the Mississippi Threatening Cargo Business, Drinking Water

WAFF-TV: News, Weather and Sports for Huntsville, AL

Low Levels on the Mississippi Threatening Cargo Business, Drinking Water

August 14, 2012

WAFF - Boats are having a tough time making it down the "Mighty Mississippi," as the river's water levels drop to historic lows. It's bad for business, since the river is one of the country's most important waterways for shipping cargo.

Right now, sending goods down the river is moving at a snail's pace. The low water levels are causing many boats to get stuck, even in the middle of the river. It's forcing some barges to stop travel all together and others to significantly reduce their weight. Even the famous "American Queen" steamboat can't make it down the river. Just a few days ago it got stuck near Memphis, forcing all 300 passengers off the boat.

With less boats and less goods making it down the river, it's driving up the cost of shipping and creating longer waits for products at grocery stores across the country. Some say the river could be on the brink of closing down. If it does, that would cost the U.S. about $300 million a day.

Meanwhile, the Governor of Louisiana has declared a state of emergency for Plaquemines Parish, near New Orleans. A large wedge of salt water is moving up the river because of the extremely low water levels, and it's threatening the area's drinking water.

Plaquemines Parish issued a drinking water advisory Wednesday to its residents. Several agencies are providing water to people in the area, while the U.S. Army Corps is working to stop the salt. They temporarily shut down the river to all traffic Wednesday while they build an underwater barrier.

But the low water levels aren't bad for everyone; fishermen are welcoming it. They said it makes fishing easy, as area lakes connected to channels of the river dry up, the catfish get stuck. After last year's flood, the lakes are chalk full of fish.

The National Weather Service expects the water levels to continue to drop.

Midwest Crops, Fish, Water Supply Punished by Drought

Midwest Crops, Fish, Water Supply Punished by Drought

July 27, 2012

Reuters - Temperatures heading north of 100 degrees Fahrenheit and scarce rain portended another blistering weekend for much of the U.S. Midwest, where the most extensive drought since 1956 is devastating crops, evaporating rivers, and threatening to push world food prices higher.

Violent storms brought rain to the extreme eastern portions of the corn belt in Ohio on Thursday night, but moisture was sparse further west.

The mercury soared in Missouri, where St. Louis was expected to reach 101 degrees F (38 Celsius) on Friday. Drought is afflicting nearly all of east-central Missouri, central and western Illinois and much of Iowa, all major corn and soybean producing states.

Farther west in Kansas City, temperatures were expected to move back over 100 degrees on Sunday as residents looked for ways to conserve water.

In Missouri, more than 600 farmers have applied for state funds to drill new wells, deepen existing wells or expand irrigation systems under a program for livestock and crop farmers severely hit by drought, Governor Jay Nixon said.

In Kansas, Governor Sam Brownback objected to federal officials releasing water from three Kansas reservoirs to keep the Missouri River navigable and protect endangered birds. A spokesperson said Brownback preferred to keep the reservoirs as high as possible to conserve water for farmers and communities drawing from them.

A year ago, the Missouri River flooded parts of Iowa, Nebraska, Kansas and Missouri, tearing up levees and roads and inundating fields.

After flooding last year, the Mississippi River is now so low that barge operators must lighten loads to avoid getting stuck.

FISH DYING, FOWL MAY BE NEXT

Extreme conditions are killing fish by the thousands in lakes and rivers and could pose a problem for migrating ducks and other waterfowl if the drought stretches into the fall, officials said.

Nationwide, fishing losses could run from tens of millions to hundreds of millions of dollars depending on how long the drought lasts and how widespread it is, said Dan Stephenson, an Illinois state fisheries biologist.

Damage to corn, soybean and wheat crops is expected to push food prices higher in the United States and around the world. The United States is the world's largest exporter of corn, soybeans and wheat.

At the Chicago Board of Trade on Friday, corn for September delivery was up 2.2 percent, August soybeans up 1.7 percent and September wheat up about 1.6 percent.

Over the next week, soaring temperatures and little rain were in store for crops in most of Illinois, Iowa, Nebraska, Kansas and Missouri, said Don Keeney, an MDA EarthSat Weather meteorologist.

"Crops will continue to deteriorate. The corn crop is already gone. and in the north and east, beans will improve some but not in the southwest," Keeney said.

Showers and cooler temperatures were expected to bring some relief to eastern parts of the Midwest on Friday, and on Saturday and Sunday in the northwest part of the region, Keeney said.

Farmers planted corn and soybeans earlier than usual this year after a warmer than normal winter, but conditions have rapidly deteriorated.

Trade sources said on Friday that Informa Economics had cut its estimate for 2012 U.S. corn yields per acre and production and its projection for U.S. soybean yields per acre and overall production.

Corn yield prospects in central and northeast Iowa were highly variable, scouts on a U.S. Midwest crop tour said.

Some plants have withered and died in the worst drought in 56 years, some have thin stalks and small ears, and others are mostly green, but visibly stressed.

All of Iowa was in severe drought or worse, according to the weekly U.S. Drought Monitor for the week ending July 24 issued by climatologists, and almost 30 percent of the nine-state Midwest was suffering extreme drought.

61% of Land Mass in U.S. Affected by Drought; Food Prices to Go Higher

Agriculture Secretary Tom Vilsack Prays for Rain

July 18, 2012

ABC News - Agriculture Secretary Tom Vilsack is praying for rain to bring relief from the drought, which is devastating crops and likely to push up food prices.

"I get on my knees every day," Vilsack told reporters at the White House today. "And I'm saying an extra prayer now. If I had a rain prayer or a rain dance I could do, I would do it."

Sixty-one percent of the U.S. is experiencing a drought, the worst in 25 years. Blistering heat and a lack of rain are threatening close to 80 percent of the corn and soy bean crops, leading to declining yields. The country's livestock is also in harm's way, as a result.

"Our hearts go out to the producers, the farm families who are struggling through something that they obviously have no control over and trying to deal with a very difficult circumstance," Vilsack said, following his Oval Office meeting with President Obama.

As of today, nearly 1,300 counties have been designated as disaster areas.

The secretary admitted that the drought, which is already driving up corn and bean prices, will likely impact the greater economic recovery.

"One out of every 12 jobs in the economy is connected in some way, shape or form to what happens on the farm," he said. "So, obviously, this drought will provide some degree of uncertainty."

Vilsack urged Congress to provide help and assistance to the nation's farmers.

"The most important thing is for Congress to take action to provide some direction and assistance so that folks know what's going to happen, what kind of protection they're going to have," he said. "That certainty is really important, and that's whether they want to get to work on the food, farm and jobs bill, they want to develop a separate disaster program or an extension of existing programs, whatever it might be. Having that done as soon as possible will be quite helpful."

In the meantime, the USDA is opening areas in the Conservation Reserve Program for emergency grazing and giving farmers access to low-interest federal loans.

Grocery Prices Headed Higher as Drought Lingers

July 18, 2012

AP - Shoppers across the country should stand up and take notice of the Midwestern drought that has already hurt supplies of corn and soybeans.

The drought will lead to higher supermarket prices for everything from milk to meat. How high will depend on what happens with rain and high temperatures in the Corn Belt in the next few weeks.

“We’re at the cusp of seeing how severely this is going to impact consumer prices,” said Darrel Good, professor emeritus of agricultural and consumer economics at the University of Illinois at Urbana-Champaign.

The drought and heat, he said, have "already done permanent damage to the crops, but our concern is the outlook for the weather is not very good and we’re expecting a further deterioration.”

If that happens, he continued,

“Prices will go up ever higher and have more severe and long-lasting impacts.”

In a twist that may sound counterintuitive, prices in the next few weeks for certain products may end up being major deals as a result of the drought.

For example, you may want to make room in your freezer for meat because prices for beef and pork are expected to drop in the next few months as farmers slaughter herds to deal with the high cost of grains that are used as livestock feed, said Shawn Hackett of the agricultural commodities firm Hackett Financial Advisors in Boynton Beach, Fla. But, he added, everything from milk to salad dressing is going to cost more in the near term, and eventually the meat deals will evaporate as demand outstrips supply.

Agriculture experts and economists largely agree that the weather conditions are expected to hurt corn crops, and in turn will impact retail prices in the weeks ahead. But we won’t know the full impact of the drought until early August or September, said Richard Volpe, research economist for the Economic Research Service of the U.S. Department of Agriculture.

Rain is in short supply across most of the country and you could be paying the price for it at the grocery store. NBC's Janet Shamlian reports.

“We don’t yet know what’s going to happen and we don’t yet know how severe the drought will be and the amount we end up getting at the end of the corn harvest,” he stressed.

The USDA provides monthly estimates of food prices but the June data showing increases of less than 5 percent for key items such as dairy and meat products does not take the recent grain issues into account. Updated figures on the drought’s impact will be released July 25.

Volpe wouldn’t provide specific projections based on conditions now, but he did say price increases for milk, that were expected to be flat or decline this year, could head up “if there’s a major jump in feed prices.”

At this point, he added,

“there’s been enough damage that we know we’re not going to have a record crop in field corn. Now the question is, how far below the record crop is this going to fall? What happens in next two weeks will drive what happens to corn and that will have an affect on all food prices.”

Field corn, also known as feed corn -- which is different from the sweet corn many of us eat during our barbecues -- is in about 74 percent of the foods consumers buy in supermarkets, he pointed out.

This year, corn supplies were expected to be more than ample because many growers in the Corn Belt -- including Illinois, Indiana, Iowa, Nebraska and Minnesota -- increased acreage of the crop to meet growing global demand, said John Riley, assistant extension professor at Mississippi State University.

“But it will now fall short because of the drought and heat,” he noted.

The price for a bushel of corn hit $7.48 a bushel at the Chicago Board of Trade this week, and government figures now project this year and next that a bushel will be as much as $6.40 a bushel, up significantly from last month's projections of $4.20 to $5 a bushel.

The expected rise in food prices is nothing new for consumers.

“Food price inflation in 2011 was well above normal,” explained Corinne Alexander, an agricultural economist at Purdue University. Grocery store food inflation was 4.8 percent last year, she said, and the expectations were of about 2 percent this year.

“The drought means above normal food price inflation in 2012, and going into 2013,” he noted.

While prices for processed foods such as cereal are not expected to rise considerably unless the shortages get much worse because producers had already instituted huge price hike last year, she continued.

But, she added, the cost of things like oil and salad dressing are likely to rise because soybean crops have also been impacted.

The food-price roller coaster is a scary ride consumers have been on for some time. There have been tight supplies going back to 2006, said Mississippi State’s Riley.

“Weather events and a bump up in demand for corn for renewable fuel,” he explained, have all contributed to the problem.

When asked if consumers should start praying for rain, he said,

“any rain moving forward is a blessing and is going to help, but I don’t know if it’s going to make it better.”

Midwest Drought Threatens Crops, Livelihoods and Food Prices

July 18, 2012

USA TODAY – Ask Craig Ganshorn how his corn crop is faring and he winces before replying. "Basically, it's burnt up," he says.

Ganshorn, 62, who has farmed 500 acres of corn and soybeans here since 1976, is confronting the grim realities of a drought that he says is worse "by far" than the one in 1988 that's remembered as among the worst in U.S. history.

Ganshorn's farm is in Kosciusko County, which is in extreme drought. He figures he won't get much return on his corn crop but hopes his soybeans, which are hardier and pollinate later than corn, will survive.

He's already calculated what this hot, dry summer means to his bottom line.

"It just cancels any idea" of buying a newer used combine to replace his rickety old one, he says, and "there will be no trip to Colorado this year."

Searing temperatures and below-normal rainfall across a broad swath of the USA have created a drought that is killing crops and drying up streams. More than 1,000 counties have been declared natural disaster areas, giving farmers access to low-interest loans. Mississippi River water levels in some areas are nearing record lows. The conditions have prompted water-use restrictions in Illinois, Indiana and elsewhere, increased risk of wildfires and a marketplace domino effect that could mean more expensive groceries.

The U.S. Department of Agriculture (USDA) last week dropped the estimated average corn yield by 12%. That means higher prices for corn, which forces livestock producers to liquidate herds because feed is too expensive. That, in turn, could mean higher prices for meat and dairy products next year because there will be fewer cattle, hogs and cows.

Food prices already are ticking upward. The Labor Department said Tuesday that food costs rose 0.2% in June from a month earlier and are up 2.7% from June 2011.

The culprit is a weather pattern that produced dry conditions in the middle of the country starting last fall, says Brian Fuchs, a climatologist at the National Drought Mitigation Center. Those conditions were exacerbated by a winter that was warmer and drier than normal, he says.

"Currently, almost 61% of the country (not including Alaska and Hawaii) is in drought, compared to 29% a year ago," Fuchs says. "Even though it is part of the natural variability of climate, this is a rare event." About 78% of the country's corn-growing regions are in drought, he says.

The Palmer Drought Severity Indexsays this drought covers the largest percentage of the contiguous USA since December 1956.

There isn't much good news in long-term weather forecasts.

"Over the next several weeks to even the next month or so, we're not really anticipating any changes to the pattern," Fuchs says.

Crops are withering

In the Clunette area, some of the drought's effects are obvious. Corn stalks are 4 or 5 feet high, about half what they should be at this point in the summer, and nobody has to mow their lawn anymore. Grass is brown and dead, and farmers are conserving water for irrigating their fields — though even some watered corn is struggling.

The drought's effects are causing alarm across the Midwest:

•The Arkansas River near Syracuse, Kan., last week had less than 1 cubic foot per second of water flowing in it. The historical mean flow: 394 cubic feet per second. The flow was the lowest recorded for this time of year since records began in 1902, says Brian Loving, a U.S. Geological Survey hydrologist in Lawrence, Kan.

The temperature of the water flowing in the Wakarusa River, southeast of Topeka, reached 103 degrees on July 7, Loving says. High water temperatures reduce the amount of oxygen available in the stream to fish and other aquatic life.

"This could be the worst drought for our streams since we started keeping records a little over 100 years ago," he says.

•Randy Miles, a soil scientist at the University of Missouri-Columbia, stuck a probe into a farm field on Monday and found no moisture more than 5 feet deep. In a normal year, he would expect only the top 12-16 inches to be dry.

Current conditions, he says, mean that "crops won't thrive." The drought, Miles says, affects everything from earthworms, which must bore deeper to find moisture, to nutrients in the soil.

•Kent Lorens, who raises livestock, wheat and corn on a 3,400-acre farm near Stratton, Neb., is giving his cows and calves protein supplements because the dry grass they're eating doesn't provide enough nutrition. They're drinking 20 or 30 gallons of water daily instead of the usual 10, he says.

•At Honker Hill Winery near Carbondale, Ill., "Some of the plants are beginning to shed their leaves like they're dying. A lot of the grapes are drying up, too," says manager Stan South. Wine is still being made from last year's excellent crop, he says, but he thinks "it's very possibly time to invest in an irrigation system."

•Salesman Mark Holzum says foot traffic at Heuer Sons Implement Co. in Cape Girardeau, Mo., is "a fourth of what it normally would be" as farmers scrap or postpone equipment purchases. "They're not in a good mood," he says.

Close to 'total failure'

Iowa and Illinois are the top corn-producing states, according to the USDA, and usually account for about one-third of the U.S. crop. Indiana typically ranks fifth, says Chris Hurt, an agricultural economist at Purdue University. Much of Iowa is abnormally dry or in moderate drought, but its situation is not as bad as the one in Illinois and Indiana.

About 61% of Indiana's corn crop is rated poor or very poor — the worst of any major corn-producing state, Hurt says.

"Those crops are getting close to having total failure," he says.

At this point in 1988, 90% of Indiana's corn was rated in those two bottom categories. "This one is not yet as intense and horrible as 1988," he says, "but it's the only one that's close to comparable."

Tell that to Bruce Ferguson, who walked into the Clunette Elevator Co. — which helps manage and stores crops — one day last week with a 6-inch ear of corn with silk hanging from it. The corn had not pollinated, which means that it would never produce full rows of kernels.

Multiply that one ear by all the unirrigated corn planted on Ferguson's 1,400-acre farm for a sense of what the drought means to him. Only about 150 acres are irrigated, he says. "You have to be prepared for a pretty complete failure this year," says Ferguson, 60, who has farmed here since 1978.

Only a "minimal amount" of his crop was insured, and Ferguson estimates his eventual losses at about $500,000 unless conditions change. "If we get 2 or 3 inches of rain soon and 1 inch every week after that, the corn could rebound," he says.

John Anglin, the elevator's co-owner, doesn't expect a reprieve.

"We can already identify some (corn) fields that will have zero yields," he says. Although some farmers will recoup most of their losses through insurance, that's no consolation, he says. "It is hard for the farmers to accept" a failed crop, Anglin says. "They would rather have a good crop than the dollars."

Meredith Powell, the Clunette Elevator's entomologist, says the drought is creating expensive problems that go beyond dryness.

"Insects thrive in this environment," she says.

Dry soil encourages Goss's bacterial wilt, which affects corn, she says, and the elevator is doing aerial spraying to try to eradicate adult corn rootworm beetles and spider mites, which attack soybeans.

John Powell, 55, who farms 2,000 acres here, faces a couple of big decisions in the next few days.

"Right now we have to decide whether we're going to put more money into the corn crop," he says. Fungicides and herbicides that would help keep surviving corn healthy would set him back another $13-$15 an acre, he says.

Powell raises ducks with his brother-in-law and already has taken a big hit on that venture because of the drought. A couple of weekends ago when the temperature hit 104 degrees, 1,700 ducks died in a single day, he says.

Miles, the soil scientist, says the drought is so widespread and severe that even a return of regular rainfall through fall won't be enough to end it.

"It would be nice," he says, "to have a winter … with plenty of snow and rain."