Rice prices could rise

Agri-food analyst Ned Schmidt made some important points during his interview with the Financial Sense Newshour over the weekend, where he noted that higher food prices are coming our way. The following points are what I felt was important:

• 1/3 Russian winter wheat crop this year may disappear and we'd have to wait until Spring 2012 for a decent crop.
• US rice prices have reversed their price action and are now heading up. This could also affect Singapore prices even though our main source of import is Thailand.
• Grain prices on the whole are heading up and this will soon feed into higher meat prices.
• There is a need to determine the damage done by the recent floods in Pakistan to its irrigation system, which in Ned's view is the most sophisticated in the world. Pakistan is the 3rd largest exporter of rice in the world after Thailand and Vietnam. If there is damage to the system, it could well mean that global supplies of rice will be reduced in the coming years, and this will undoubtedly have an impact on us in Singapore.
  
• Famine in some poorer parts of the world cannot be ruled out. For example, the food situation in Egypt is now critical.

In view of this, what I am likely to do is to look at enhancing my family's food storage capabilities to store more staples and also look at putting more money into investments related to agriculture.

What are you going to do for your family?