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    Mongabay, a leading resource for news and perspectives on environmental and conservation issues related to the tropics, has launched Tropical Conservation Science - a new, open access academic e-journal. It will cover a wide variety of scientific and social studies on tropical ecosystems, their biodiversity and the threats posed to them. Tropical Conservation Science - March 8, 2008.

    At the 148th Meeting of the OPEC Conference, the oil exporting cartel decided to leave its production level unchanged, sending crude prices spiralling to new records (above $104). OPEC "observed that the market is well-supplied, with current commercial oil stocks standing above their five-year average. The Conference further noted, with concern, that the current price environment does not reflect market fundamentals, as crude oil prices are being strongly influenced by the weakness in the US dollar, rising inflation and significant flow of funds into the commodities market." OPEC - March 5, 2008.

    Kyushu University (Japan) is establishing what it says will be the world’s first graduate program in hydrogen energy technologies. The new master’s program for hydrogen engineering is to be offered at the university’s new Ito campus in Fukuoka Prefecture. Lectures will cover such topics as hydrogen energy and developing the fuel cells needed to convert hydrogen into heat or electricity. Of all the renewable pathways to produce hydrogen, bio-hydrogen based on the gasification of biomass is by far both the most efficient, cost-effective and cleanest. Fuel Cell Works - March 3, 2008.

    An entrepreneur in Ivory Coast has developed a project to establish a network of Miscanthus giganteus farms aimed at producing biomass for use in power generation. In a first phase, the goal is to grow the crop on 200 hectares, after which expansion will start. The project is in an advanced stage, but the entrepreneur still seeks partners and investors. The plantation is to be located in an agro-ecological zone qualified as highly suitable for the grass species. Contact us - March 3, 2008.

    A 7.1MW biomass power plant to be built on the Haiwaiian island of Kaua‘i has received approval from the local Planning Commission. The plant, owned and operated by Green Energy Hawaii, will use albizia trees, a hardy species that grows in poor soil on rainfall alone. The renewable power plant will meet 10 percent of the island's energy needs. Kauai World - February 27, 2008.

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Monday, June 02, 2008

World grain prices falling sharply on eve of summit

Prices of the world's most important food grains are falling more rapidly than expected because of better harvests, increased production and a withdrawal of speculators from the market. The steep decline comes in spite of record high oil prices, which are the leading cause of the high prices seen in the recent past. The drop in agricultural commodity prices comes on the eve of a world food summit over at the FAO, an organisation that predicted prices to remain high.

Over the past 3 months, the price of wheat has dropped by 37 percent, that of rice by 23 percent. The trend is even stronger for milk and powder milk (a commodity imported on a large scale by developing countries): prices are down by more than a third, even though they weren't that high to start with. Low milk prices are making European producers desperate, and the fear of the reappearance of 'milk lakes' that go to waste is back. Farmers are protesting in France, Belgium, Spain and Germany.

Because of the sharp decline in rice prices, large exporting countries like Cambodia have already lifted their export ban; Vietnam is to lift its ban next month. Rice was under speculative attack, with prices increasing by 80 percent over a period shorter than 3 months.

Analyses of the positions of food commodity speculators indicates they are betting on continued falling prices for wheat and rice. Apart from oil prices, speculation is seen as the second most important factor determining movements in the market:
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Despite these rapidly falling prices, the food situation remains precarious. Price changes for raw commodities do not immediately translate into lower prices for consumers. Retailers in Europe have been accused of keeping prices high even after prices for raw materials have been falling.

This week, both the FAO and the OECD will convene important meetings to discuss the world food crisis. In a recent report, the FAO warned that food prices will remain high for the foreseeable future. It sees this situation as an opportunity to boost investments in agriculture in developing countries. A great number of countries, especially in Africa, can increase output relatively easily provided basic investments are made into access to input markets (seeds, fertilizers, tools), output markets, and infrastructures.

Over the past quarter of a century, investments in agriculture have been neglected by the international donors and community. For example, in 1980, the World Bank used 35 percent of its loans for investments in agriculture in developing countries. In 2007, this was a mere 11 percent. Only recently, after the crisis hit, has it pledged to make agriculture its top priority once again.

However, investments in poor countries' agriculturals sectors are seen as long term remedies only, and many analysts warn immediate action is needed to prevent putting 100 million food insecure people at risk. Surprisingly, though, the sudden and steep decline of wheat and rice prices, show farmers are capable of increasing production with today's means and infrastructures. At least to an extent, because speculation and the oil price are factors beyond their control.

De Standaard: "Voedselprijzen dalen ondanks crisis" [Food prices falling despite crisis] - June 2, 2008.

Gazet Van Antwerpen: "Prijzen van tarwe en rijst dalen, wanneer de winkelprijzen?" [Wheat and Rice Prices Falling, When Do Retail Prices?] - June 2, 2008.

Het Laatste Nieuws: "Voedselprijzen dalen ondanks crisis" [Food Prices Plummet Despite Crisis] - June 2, 2008.


Blogger ahmad wiyono said...

i love this blog! keep up good works. See you again..

6:06 PM  
Blogger Sunny said...

This post has been removed by the author.

7:35 AM  
Blogger Sunny said...

Very informative! I love the explanation about the economic impacts. It's a great refresher on the nature of global economics and speculation.

Fair winds,
Sunny Lam

Ffenyx Rising

7:36 AM  

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