Commodity Price Spikes Hit the Weakest First

Posted: May 24th, 2008 by: h-2

The following story shows how the global diesel shortage directly affects an entire region in Africa’s domestic wheat production.

Wheat farmers in the Southern Rift Valley on Tuesday said they were unable to prepare their land for planting due to a serious shortage of diesel.

“It will not be possible for some farmers to plant wheat next month because some parts will be too dry,” said Mr Samuel Gitonga, the chairman of the Nakuru chapter of Kenya National Federation of Agricultural Producers.

Mr Gitonga said that some farmers had been harrowing their farms in readiness for planting wheat but had now suspended it due to lack of diesel. Farmers in the Rift Valley Province produce about three million bags of wheat annually but Mr Gitonga said that the target may not be achieved.
Fuel shortage threatens South Rift wheat output, 5/14/2008

As you can see, unlike the dreams of economists, the markets do not in fact adjust everything nice and neatly, it’s a fairly brutal, unforgiving game, and the sooner countries extract themselves from the industrialized agriculture system, the better off they all will be.

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