Duxton’s Agri Bits and Pieces – Vol. 345
Posted on: August 7th, 2017

QUOTE OF THE WEEK

This week’s quote of the week comes from the USDA in its first forecast of food-price inflation for 2018, which expects inflation to quicken for wheat, beef and fresh fruit next year after some declines in 2017.

“It looks like next year might be a good time to cut the carbohydrates as a drought-fuelled jump in wheat costs will make bakery goods the food items with the biggest price gains for U.S. consumers. Higher prices paid to farmers, combined with lower imports, may increase grocery and restaurant costs for baked goods and cereals as much as 4 percent next year”

 

JAPAN UPS TARIFFS ON US BEEF, GIVING AUSSIE MEAT THE EDGE

Japan’s Ministry of Agriculture, Forestry and Fisheries is set to invoke ‘a snapback’ on imports, to protect Japan’s domestic cattle producers from rapid rises in imports.

Beef market analyst Angus Brown said the snapback mechanism only applied to countries that did not have trade agreements with Japan.

“If imports from a country that doesn’t have an economic partnership agreement rise more than 17 per cent from the year earlier, it will trigger the increase in tariffs from 38.5 per cent to 50 per cent and that’s only on US frozen beef imports into Japan,” he said.

Happily for Australia, it does have an economic partnership with Japan — a free trade agreement signed in 2015.
Under the trade agreement, Australian frozen beef attracts a tariff of 27.2 per cent, around half that imposed on US imports under the snapback measure.

Japan’s so-called safeguard trigger had not been used in more than a decade against the US and it could have massive implications for Australia.

Analyst Simon Quilty said it would make Australian beef far more attractive to the Japanese consumer.

“Just to try to put it in perspective, what it would mean if a frozen rib eye was to go into that market, it relates back to a price for the Japanese of about a $2.50 difference as a direct result of the difference in tariff,” he said.

Chairman of the Australian Meat Industry Council Lachie Hart helped pioneer Australian beef exports to Japan. He said the news from Japan was very welcome at a tough time for the industry, already impacted by the strong Australian dollar.

SCIENTISTS DIM SUNLIGHT, SUCK UP CARBON DIOXIDE TO COOL PLANET

Scientists are sucking carbon dioxide from the air with giant fans and preparing to release chemicals from a balloon to dim the sun’s rays as part of a climate engineering push to cool the planet.

If buried underground, vast amounts of greenhouse gases extracted from the air would help reduce global temperatures, a radical step beyond cuts in emissions that are the main focus of the Paris Agreement.

The Paris Agreement seeks to limit a rise in world temperatures this century to less than 2 degrees Celsius (3.6 Fahrenheit), ideally 1.5C (2.7F) above pre-industrial times.

But U.N. data show that current plans for cuts in emissions will be insufficient, especially without the United States, and that the world will have to switch to net “negative emissions” this century by extracting carbon from nature.

Riskier “geo-engineering” solutions could be a backstop, such as dimming the world’s sunshine, dumping iron into the oceans to soak up carbon, or trying to create clouds.

Among new university research, a Harvard geo-engineering project into dimming sunlight to cool the planet set up in 2016 has raised $7.5 million from private donors. It plans a first outdoor experiment in 2018 above Arizona.

David Keith’s team from Harvard’s aims to release about 1 kilo (2.2 lbs) of sun dimming material, perhaps calcium carbonate, from a high-altitude balloon above Arizona next year in a tiny experiment to see how it affects the microphysics of the stratosphere.

And many experts fear that pinning hopes on any technology to fix climate change is a distraction from cuts in emissions blamed for heating the planet.

“Relying on big future deployments of carbon removal technologies is like eating lots of dessert today, with great hopes for liposuction tomorrow,” Christopher Field, a Stanford University professor of climate change, wrote in May.

The most natural way to extract carbon from the air is to plant forests that absorb the gas as they grow, but that would divert vast tracts of land from farming. Another option is to build power plants that burn wood and bury the carbon dioxide released.

Among other possible geo-engineering techniques are to create clouds that reflect sunlight back into space, perhaps by using a mist of sea spray. That might be used locally, for instance, to protect the Great Barrier Reef in Australia, said Kelly Wanser, principal director of the U.S.-based Marine Cloud Brightening Project.

 

CHART OF THE WEEK

This week’s chart of the week comes from Bloomberg’s Europe’s Butter Mountain has Melted Away with global  consumption of butter rising 3% in 2017 according to USDA data. Increasing European consumption has dwindled stockpiles that has sent global prices skyrocketing.


 

JOKE OF THE WEEK

 

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