Marc Chandler submits:In a time when there is much discussion of peak oil and the idea that other commodities are less abundant or more costly to access, one issue that might not get enough attention among investors is the shortage of water. Some political scientists, for example, have suggested that the next war in the Middle East may be over water, not oil. Grain is very water-intensive. Roughly speaking, it takes 1,000 tons (100 cubic meters) to grow a ton of grain.
MUCH of America's agricultural heartland is in the grips of extreme to exceptional drought. It is becoming increasingly clear that this drought will take a significant toll on some of the nation's principal food crops, especially corn, wheat, and soybeans.
Yu Ruicheng's weathered face creases with worry as she stands on her dry wheat field in eastern China, where a record drought is threatening to send soaring global food prices even higher."If it doesn't rain next month, we won't harvest anything," the 62-year-old farmer says, crouching down and sifting parched soil through her fingers, pointing to dried-up wheat shoots scattered across her plot of land.
Russia's drought and massive wildfires have sent wheat prices through the roof. Fortunately, most U.S. wheat farmers have had a stellar harvest and are likely to help meet global demand. That's especially the case in Colorado, which exports 80 percent of the wheat it produces.» E-Mail This » Add to Del.icio.us
Chris Damas submits:
I have a small news clipping saved on my desk (from the AFP newswire) about the Russian drought. It’s dated July 11, 2010 and I plan to paste it to my forehead this weekend. Because I didn’t pay enough attention to it. The small clipping has became a big story over the past 2 days.
By Laura Philomin and Stuart GrudgingsSINGAPORE/KUALA LUMPUR (Reuters) - Singapore and Malaysia are grappling with some of the driest weather they have ever seen, forcing the tiny city-state to ramp up supplies of recycled water while its neighbor rations reserves amid disruptions to farming and fisheries.Singapore, which experiences tropical downpours on most days, suffered its longest dry spell on record between January 13 and February 8 and has had little rain since.