Monday, July 14, 2008

New record

"One of Australia's worst droughts on record is hurting wheat farming just as the world needs it most. Australia is usually the world's third or fourth-largest exporter of wheat. But exports dropped 46 percent from 2005 to 2006, then fell 24 percent last year.

Most of its exports go to the Middle East and Southeast Asia to make bread and cereals, but the fall in supply has led to a spike in prices. A ton of Australian wheat now costs $367, compared with $258 in early 2007, an increase poor countries can ill afford.

"When they pay high prices, they pass on an increase to their poorest people, who can no longer afford it," says Kunhamboo Kannan, director of agriculture, environment and natural resources at the Asian Development Bank. "Just look at Egypt." Riots over rising bread prices and shortages have led to at least 10 deaths in Egypt this year."

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