Weekly Press Summary

Researchers at Aalto University in Finland have warned that a third of global food production will be at risk by the end of this century if greenhouse gas emissions continue to rise at their current rate.

As part of a recently published roadmap on reaching net-zero carbon emissions by 2050, the International Energy Agency (IEA) has called for a 60 per cent increase in the use of energy from biomass. The IEA says that this will require an additional 410 million ha of land under crops but argues that farmers can achieve this by using currently unproductive marginal land.

Farmers in Brazil’s Centre-South region are concerned that, they may run out of water to irrigate their coffee and orange juice trees if the current drought continues. Analysts are already marking down sugar cane production but expect the lack of rainfall to impact ethanol more than sugar. Drought is also affecting farmers in some areas of California.

After a blocked Suez Canal and a hacked pipeline, a crack in a road bridge near Memphis, Tennessee, has highlighted the fragility of global supply chains.  Authorities closed the Mississippi River for four days, blocking more than 60 vessels and 1,000 barges, before reopening it last Friday.

In Australia, a plague of mice is creating havoc across New South Wales and Queensland, contaminating grain stocks and threatening new crop planting. Farmers are concerned that the mice will eat newly sown seeds before they can germinate.

China is looking to join the CPTPP, the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, and has already held informal talks with member nations. The CPTPP is the successor to the Trans-Pacific Partnership. The US is also considering (re)joining.

Oatly, a plant-based milk company, plans to raise $1.65 billion in their IPO this week: $1.1 billion in new shares and the rest from current investor share sales. If it succeeds, the IPO will value the company at $10 billion, five times more than at the time of its most recent round of fundraising last year.

Cofeed, a Chinese agricultural data provider, has suspended operations without explanation. Traders relied on Cofeed for data on China’s soybean and soymeal stocks, crushing volumes, crushing margins and corn pricing.

Vicentin, the cash strapped Argentine soy crusher, is talking with Viterra, Molinos Agro and the Argentine cooperative ACA to sell a majority stake in the company. Vicentin owes more than $1 billion to banks and farmers. Still in Argentina, the government has banned beef exports for one month to dampen an inflation rate approaching 50 per cent.

The US ethanol producer POET is in talks with Flint Hill Resources to purchase the firm’s six ethanol plants with a combined capacity of 800 million gals/year. The purchase would increase POET’s total capacity to 3 billion gals/year.

Ivory Coast has asked the EU to be flexible when it introduces new legislation later this year to remove deforestation and child labour from the cocoa supply chain. Ivory Coast has asked the EU to phase in the measures over five years.  The EU buys almost 70 per cent of the Ivory Coast’s cocoa. However, in a good news story, Ivory Coast’s cocoa farmers are finding increased demand in the EU for organic cocoa.

A Seattle-based start-up is developing fake coffee made from sunflower seed husks and watermelon seeds. The company says that the resulting grounds are brewed just like a regular cup of coffee and contain caffeine. (I think I will stick with the real thing.)

Meanwhile, Canadian coffee lovers can now appreciate two unusual (real) coffee varieties: Liberica beans from Malaysia and Racemosa from South Africa.

In a ‘Farm to Face’ situation, Global Bioenergies has launched a range of cosmetics made from sugar beet residue. Meanwhile – in what could be called ‘Root to Race’ – some Formula One teams are pushing for a delay in an increase in the sport’s use of ethanol.

US households are consuming less cow’s milk. Sales dropped by 12.2 per cent from 2013 to 2017, the latest year data is available. The sales of plant-based alternatives such as almond and soy milk increased by 35.7 per cent over the same period.

Meat producers are worried that beef is the new coal. As previously reported, the Boston Consulting Group has forecast that meat alternatives will make up 11-22 per cent of the global protein market by 2035. A recent Kearney study has projected global meat sales to peak in 2025 and decline by 33 per cent by 2040.

Finally, two of Bloomberg’s top commodity journalists have written an opinion piece in the NY Times calling for increased government regulation of physical commodity trading. The article focuses on resource extraction in the oil and mining businesses, but it also contains the somewhat surprising misstatement that seven trading companies supply half the world’s food. As I wrote in my bookOut of the Shadows, The New Merchants of Grain – seven trading companies account for half of the world’s shipborne trade in grains and oilseeds, not half of the world’s food.

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