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Unprecedented Droughts In USA: Major Food Crisis Ahead?

28 July 04:57 PM

The global warming and other global climate changes are getting more and more evident. More people around the globe start feeling the consequences of the human impact on the climate of our planet. While some regions are suffering with droughts, others are in danger of being flooded.

Obviously, such extreme weather conditions cannot by affect harvests. The world may face a food crisis. How serious is the danger and what are the major reasons?

Unprecedented Droughts In USA: New Trend In Global Food Markets

According to Eugene Olkhovsky, Masterforex-V Academy’s leading expert, the unprecedented droughts currently seen in the USA, Europe and Russia may become the major reasons for a possible food crisis. These are the countries that have always been lifesavers during for starving regions. Now they may found themselves in involved in a severe food crisis.

The USA, one of the world’s major food producers and exporters, is currently suffering from the severest drought in over 50 years. 26 states (55% of the US territory) have already been announced disaster areas. The last time the USA saw such a disastrous drought was 1956. However, most experts say that if the drought continues, the situation may become even worse (like it was in 1936, when the Americans lost almost the entire harvest of corn). The dry weather is expected to last for 2 more weeks.

The US crops will are seeing major damage. For now, the SSDA expects that up to 30% of the overall harvest will be lost.

The US drought has had a major negative impact on the global market of crops. At the same time, much poorer harvests of soybeans and wheat will affect both the domestic consumption and the export to Egypt and China.

Soybeans

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Wheat:

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Global Food Crisis Ahead?

July’s report published by the USDA says that the global production of wheat is expected to decline by 6 million 700 thousand tons. This concerns all agricultural countries. The USA is not the only country suffering from droughts. The same holds true for Brazil, Argentina, Uruguay and Paraguay. Russia, Ukraine and Kazakhstan have already downgraded their forecast for wheat.

China and EU countries are also expected to gather poor harvests. Last week. Strategie Grains downgraded its forecast for grains by 600 thousand tons down to 123.6 million tons.

According to the International Grains Council, by the end of the 2012-2013 marketing year, the global reserves of grains will shrink by 9 million tons, thus reaching the lowest level in 5 years.

The droughts are also affecting the global harvest of coffee. The coffee futures contract is still fluctuating within the $177-190/b range. The major reason for the rally was the mass closure of short speculative trades in advance of the new harvest supplies from Brazil. Later on, the price went back into the range. The previous USDA report was bearish. However, heavy rains in Brazil’s major coffee growing regions became a bullish driver.

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Global Crop Failure: Possible Consequences

Luckily, no analysts are seriously considering the possibility of a major food crisis. Last year’s harvests were abundant. Therefore, most countries around the globe still have abundant reserves, even such overpopulated countries as China and India.

For example, Russian analysts say that Russia’s reserves will be enough to supply the domestic needs and to export crops to those who will be in need.

However, there will be 2 major consequences of the dry summer of 2012:

1. Higher food prices

2. Lower food export (humanitarian aid) to starving nations

Market Leader and Masterforex-V Academy would appreciate if you could participate in a survey. Please, visit the Academy’s forum for traders and investors and answer the following question:

Will the world face a major food crisis in 2012-2013?

You are free to discuss this article here: forum for traders and investors

Got a question? – Ask it here »

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The Washington Post On European Crisis and Euro

Over the last few years, the word collocation “European crisis” has turned into a set expression. It’s been almost 5 years since it began. Europe seems to have suffered most of all form the global crisis. 2 years ago a new wave of crisis broke out, thereby turning into a severe debt and banking crisis in the EU and the eurozone.

Good news are scanty while bad news keep coming from Europe almost every day. Yet, the world cannot ignore it because Europe accounts for nearly 20% of the entire global economy. Even though everyone seems to get used to unexpected (sometimes shocking) and controversial news from the area, they are still worried about the destiny of the Old World? A complete downfall or a renaissance?

Publication date: 13 May 12:48 PM

The latest opinion polls conducted in the EU show that more and more European citizens show distrust in the EU and the eurozone. The biggest decline was seen in the EU’s 6 biggest countries. In particular, in Spain , the distrust increased up to 72%. For comparison sake, it used to be just 23% 5 years ago.

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The purpose of fighting is to win, as the well-known saying goes. At Forex market traders, no matter whether they want it or not, have to fight not only for profits, but also... between themselves. In order to succeed, one has to manage his emotions, resisting panic, act on the basis of competent full-scale analysis of current and perspective situations, know and understand own trading strategies, based on numerous technical and fundamental components.

Publication date: 26 April 09:49 AM

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Publication date: 18 April 10:22 AM

China is reporting about another epidemic of the so-called bird flu (also known as virus H7N9). It has already suspended the domestic poultry trade. Numerous markets are closed in Shanghai, Beijing and other big cities. Chinese bloggers keep posting shocking footage showing dead birds.

At the same time, top-ranking Chinese military officials put the blame on the USA. They say this is some kind of a secret biotechnological weapon developed and used by the Americans.

Russia takes urgent steps to prevent the epidemic from spreading over its territory. Russia’s chief medical officer urges people to abstain from visiting the neighboring Asian country. There are temporary limitations for those who arrive from China. Russia may eventually close the border with China until the situation stabilizes.

What is really happening in China? How dangerous is the current epidemic? Can the USA be involved?
Let’s try to answer these questions together…

Publication date: 17 April 07:08 AM

The USA seems to threatening Russia not only with a shale revolution but also with a shale war. The North-American shale boom seen in the region over the last few years, has been treated as the end of Russia’s oil and gas industry. Everything started from shale gas, which allowed the USA to turn from an NG importer into a net exporter of this energy carrier.

Yet, US officials do not conceal the fact that they are going to use this trump card to free Europe from the dependence on Russian energy carriers. Now American observers and analysts are discussing the gloomy prospects of Russia’s export of energy carriers caused mainly by the shale boom in the USA and worldwide.

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Publication date: 16 April 02:58 PM

Western mass media are actively discussing Russia’s external policies. There is a lot of information published on this topic recently. There are countless articles devoted to Putin and Russia.
If to try to sum up all the information on this topic, it turns out that there are 2 groups with different attitude towards Russia’s external policies.

The bigger group thinks that Russia’s external policies are unpredictable and may be dangerous to the West. Therefore, they urge Western politician to exert pressure on Moscow in effort to restrict its tough external policies.

The minor group views Russia as a potential partner, thereby calling its external policy rational and pragmatic.

The confrontation between the 2 groups can be considered on the example of an article written by Mark Adomanis and published by Forbes. It is called Is Vladimir Putin's Foreign Policy Unpopular? Not So Much.

Publication date: 16 April 11:07 AM

These days it is difficult to surprise people. However, there are exceptions. In particular, Zbigniew Brzezinski, a Polish American political scientist, geostrategist and statesman, managed to surprise us.

Some 15 years ago, he used to diminish Russia’s role in the international arena, thereby calling it a defeated opponent of the West. This is not a long time in historical terms. However, Mr. Brzezinski seems to have changed his mind and attitude towards Russia and its geopolitical and economic role in the world.

In his recent book called “Strategic Vision: America and the Crisis of Global Power” (2012), Zbigniew Brzezinski ponders upon the ways of uniting Russia and the West. Moreover, he tries to prove the inevitability of this process. He assumes that the world’s center of gravity is shifting “from the West to the East.” Therefore, the West will have to unite with Russia in order to avoid global isolation.

The West may well avoid the destiny of the frontrunner. However, it is necessary to work out a new strategy. The new strategy should imply the plan aimed at integrating Russia and Turkey into the international system of the West. This sounds strange if to consider the fact that this was told by a Russophobe and a Pole. This looks like a major change in his views. What are the real reasons behind his sudden love for Russia?

Publication date: 15 April 07:03 PM

Until now community continues arguing for and against reality of earning money via Internet. Extremely hard are disputes whether Forex market may be considered a true effective means of gaining stable profit.

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Publication date: 14 April 10:46 AM

George Soros, the world-famous investor and billionaire, urges Germany to make a crucial decision. In particular, he says German authorities should change their attitude towards common Eurobonds or quit the eurozone.

Publication date: 11 April 07:26 AM

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