Big Sugar Is Set for a Sweet Bailout

The U.S. Department of Agriculture is considering buying 400,000 tons of sugar—enough for 142 billion Hershey's Kisses—to stave off a wave of defaults by sugar processors that borrowed $862 million under a government price-support program.

The action aims to prop up tumbling U.S. sugar prices, which have fallen 18% since the USDA made the nine-month operations-financing loans beginning in October. The purchases could leave the price-support program with an $80 million loss, its biggest in 13 years, said Barbara Fecso, an economist at the USDA, in an interview.

The move would benefit companies that turn sugar beets and sugar cane into granulated sweetener, a business plied by American Crystal Sugar Co., Amalgamated Sugar Co. and U.S. Sugar Corp. The USDA wouldn't say how many companies have received loans, or identify them. U.S. Sugar said it doesn't have any USDA loans outstanding. American Crystal and Amalgamated didn't respond to requests for comment.

Higher prices would hit food companies including candy giants Mars Inc., Hershey Co. and Nestlé SA, and could ultimately boost retail food prices, at a time when many consumers are financially stretched. Read more >>

More than 50 million Americans short of food

 More than 50 million Americans couldn't afford to buy food at some point in 2011, according to federal data. Children in some 3.9 million households suffered from food insecurity last year, with their families unable to provide them with adequate, nutritious food at times.

Nearly 17 million Americans suffered from "very low food security," meaning they had to reduce the amount they ate, saying the food they bought did not last and they didn't have the funds to buy more.

They typically found themselves in this situation a few days a month for seven months of the year. The number of people in this category shot up by more than 800,000 from 2010, according to a U.S. Department of Agriculture report released Wednesday. Women living alone, black households and the poor and near-poor were affected the most. Read more >>

USDA Slashes Corn Outlook - "Food Price Spike Dead Ahead"

A scorching drought across the Midwest will slash corn yields by much more than most analysts had expected, the government said in a report that reignited a record rally in grain prices. The U.S. Department of Agriculture said the crop will average just 146.0 bushels an acre, down 20 bushels from its June estimate.

As a result, the agency reduced its forecast for ending stocks by 37 percent from last month, partly offset by lower exports and less ethanol usage. The surprisingly deep cut to the yield outlook shocked traders, who had expected the USDA to take a more conservative approach to adjusting its outlook. The reduction in ending stocks was deeper than the forecast for a 32 percent cut. Read more >>

This from Zero Hedge:

Who knew the next black swan would be deep fried? The biggest piece of imminent food inflation news over the past months, coupled with what is shaping up to be another record hot summer (for the best tracking of real-time electricity consumption primarily for cooling news we recommend the following PJM RT tracker of power load), has been the collapse in the corn harvest due to the worst drought since 1988 as 56% of America is in drought conditions.

Today, the US just added some burning oil to the popcorn by cutting the corn-crop forecast by 12% to 13 billion bushels on expectations of a 13.5 billion harvest. Then again, who needs corn, when you can have cake? Read more >>

Food Stamp Rolls Continue to Rise

More people tapped food stamps to pay for groceries in September as the recession and lackluster recovery have prompted more Americans to turn to government safety net programs to make ends meet.

Some 42.9 million people collected food stamps last month, up 1.2% from the prior month and 16.2% higher than the same time a year ago, according to the U.S. Department of Agriculture.

Nationwide 14% of the population relied on food stamps as of September but in some states the percentage was much higher. In Washington, D.C., Mississippi and Tennessee – the states with the largest share of citizens receiving benefits – more than a fifth of the population in each was collecting food stamps. More...

Food Stamp Usage Soars Among Working Families

Data from the U.S. Department of Agriculture reviewed by The Associated Press shows that 32 states have adopted rules making it easier to qualify for food stamps since 2007. In all, 38 states have loosened eligibility standards.

Eligibility for food stamps varies from state to state, with the 11 most generous states allowing families to apply if their gross income is less than double the federal poverty line of $22,050 for a family of four on the U.S. mainland. The threshold is higher in Alaska and Hawaii.

With more than 1 in 8 Americans now on food stamps, participation in the program has jumped about 70 percent from 26 million in May 2007, while the nation's unemployment rate rose from 4.3 percent to 9.2 percent through September of this year. More...

USDA Reports Food Shortages: Wall Street 'Caught Off Guard' by Severity

Image by Getty Images via @daylife

Eric Blair
Activist Post

Several recent headlines indicate that food prices will continue their swift climb upward. These troubling new reports show that agriculture production and stored grains are critically low and experts are now predicting food shortages on a grand scale.

Look at a few mainstream headlines: Drought threatens global rice supply in the India Times; VA farmers say heat taking toll on crops, Associated Press; Severe food shortage follows lack of rainfall in Syria; and, finally, Corn prices bolt as USDA downsizes crop estimates, which states that, "Commodity professionals were caught off guard Wednesday by a U.S. Department of Agriculture report showing 1 million fewer acres of corn planted this year than earlier projected, and almost 300 million fewer bushels of corn in storage." And these articles don't begin to address crops being damaged by the toxic rain from the Gulf oil disaster.

We are back to recession economics and rapidly heading toward a deeper, longer “Third Depression.” With all recent economic indicators setting new record lows and deficits at record highs, this ship is only going one way folks, down, down to Chinatown. This WTC-Building 7-style-controlled-demolition of the U.S. economy has long been engineered by the borderless banksters and has been set in the same way to collapse at a free-fall rate. With all of the manufactured confusion it may be difficult to know where best to invest your limited assets, but it seems to be clear that Food is on the march.

There were several trend forecasters and financial firms predicting upwards of $200/barrel of oil before the Gulf oil gusher. The “analysts” said this would occur because of the perception of scarcity and a weakening dollar. The oil disaster and the subsequent outrage at Big Oil will surely take care of selling the perception of scarcity, while the Federal Reserve and Congress will surely take care of weakening the dollar. More...