I hope you aren't planning to eat any bread any time soon. If so, you'd better have some serious quantities of wheat in storage, because global supplies are tight. Ukraine, a leading exporter to Europe and the world, just curbed exports within the past few hours. Supplies are tight world-wide, and the hot weather is damaging crops in the American Midwest, known as the bread basket to the world.
It's probably going to get worse, too, over the next few years. Energy legislation already passed by the US House would reduce crop acreage in the US by nearly 14.5%, and the higher cost of energy is going to significantly reduce crop production due to higher diesel and fertilizer prices. During the Depression, FDR promised farmers higher prices, so he cut production of all sorts of farm products, destroying millions of acres of crops and slaughtering millions of head of livestock, thus putting many Americans in food lines. Should we expect anything different from President Obama, who has stated that FDR was his hero?
Even a non-grain trader can read these attached charts and know what they mean. One chart is the overnight price of wheat, rising powerfully through the roof over the past 12 hours. The other chart is the daily one, showing the price of wheat rising steadily through the month of July. Imagine the impact on the price of everything, including meat, as the staples of existence continue rising powerfully!
By the way -- other grains are following suit!
I hope you have plenty of food storage. You are going to need it!
