News

June 15, 2008

That Was The Week That Was: Rice And Grain Up, And Cocoa At A 26-Year High

By Sally White

High food prices and fuel prices have replaced the credit squeeze as the leading threats to the world economy, according to the communiqué from the Group of Eight finance ministers at the weekend. The predominant fear is the inflationary effect, and in response central banks are already shifting towards tighter monetary policy, even though worldwide economic growth is cooling.

US land values are seeing the knock-on effect of higher food prices, with gains from Iowa to Wyoming reported at between 78 per cent and over 200 per cent over the past 10 years. Prices in Iowa increased by 22 per cent last year to US$3,908 an acre, according to research by Iowa State University.

Farm values are forecast to rise at an annual rate of six to ten per cent over the next five years, according to Murray Wise, chief executive of Westchester Group, an...