Grain stock to hit 35-year low next yr
Sunday, 25 November 2007
Grain stocks worldwide are expected to fall to their lowest level in 35 years in 2008, raising concerns that the economy will be hit by a double whammy of soaring grain and oil prices.
The Korea Rural Economic Institute reported that the lowest level of grain stocks in more than three decades points to higher prices next year.
``Rising demand for grain commodities from China and other developing nations is driving up agriculture prices, but the problem we are having is that the world can't meet the surging demand due to a supply shortage,'' said Sung Myung-hwan, a senior researcher at the institute.
He said this will intensify ``agflation'' _ coined from the words, agriculture and inflation, adding that consumers, above all, will be burdened by increasing grain prices.
For instance, Korea has seen its wheat prices go up by 30 to 40 per cent so far this year, and the country that depends on grain imports for everything except rice is going to feel the pressure even more next year.
Sung said rice is the only commodity that the country massively produces, while the rest such as corn, wheat and soybean are ``almost all'' imports.
The Korea Rural Economic Institute reported that the lowest level of grain stocks in more than three decades points to higher prices next year.
``Rising demand for grain commodities from China and other developing nations is driving up agriculture prices, but the problem we are having is that the world can't meet the surging demand due to a supply shortage,'' said Sung Myung-hwan, a senior researcher at the institute.
He said this will intensify ``agflation'' _ coined from the words, agriculture and inflation, adding that consumers, above all, will be burdened by increasing grain prices.
For instance, Korea has seen its wheat prices go up by 30 to 40 per cent so far this year, and the country that depends on grain imports for everything except rice is going to feel the pressure even more next year.
Sung said rice is the only commodity that the country massively produces, while the rest such as corn, wheat and soybean are ``almost all'' imports.