USDA World Agricultural Supply and Demand Estimates show a declining US corn crop:
Global wheat supplies are projected slightly higher for 2010/11 as higher world production offsets lower carryin, mostly reflecting higher 2009/10 wheat feeding in China. World production is raised 1.5 million tons for 2010/11 as increases for Argentina, Australia, EU-27, and Paraguay more than offset reductions for FSU-12 and the United States.
Corn ending stocks for 2010/11 are projected 75 million bushels lower. At 827 million bushels, ending stocks would be the lowest since 1995/96 and represent a carryout of 6.2 percent of projected usage. In 1995/96, carryout dropped to 5 percent of estimated usage. The season-average farm price is projected at $4.80 to $5.60 per bushel, up 20 cents on both ends of the range and well above the previous record of $4.20 per bushel in 2007/08.
Global coarse grain supplies for 2010/11 are projected 3.3 million tons lower reflecting reduced corn production in the United States, reduced barley production in China, and reduced oats and rye production in Russia.
Global 2010/11 rice supply and use are lowered from a month ago. World 2010/11 production is forecast at a record 451.4 million tons, down 1.1 million from last month due mainly to decreases for Burma, Pakistan, the Philippines, and South Korea, which is partially offset by an increase for Australia.
Corn use for ethanol is raised 100 million bushels with record October ethanol production indicated by weekly Energy Information Administration data and favorable ethanol producer margins. Ethanol prices continue to track higher with corn prices, supporting returns for ethanol producers. Although small relative to domestic usage, higher ethanol exports and lower imports are also expected to add to corn use for ethanol with high sugar prices limiting the availability of ethanol from Brazil.
Have to feed the all important carz. Not a crisis period such as 2008 but lower ending stocks are part of a longer term trend.
Meanwhile, a part of the education business turns out to be a racket, funneling taxpayer funds to big business. Sound familiar? Here, the funnel is Kaplan University and its tens of thousands of hopeful suckers and the big business is defense industry shill the Washington Post!
Kaplan and other for-profit education companies have come under intense scrutiny from Congress, amid growing concerns that the industry leaves too many students mired in debt, and with credentials that provide little help in finding jobs.
Reports of students who leave such schools with heavy debt, only to work in low-paying jobs, have prompted the Department of Education to propose regulations that would cut off federal financing to programs whose graduates have high debt-to-income ratios and low repayment rates.
Though Kaplan is not the largest in the industry, the Post Company chairman, Donald Graham, has emerged as the highest-profile defender of for-profit education.
Together, Kaplan and the Post Company spent $350,000 on lobbying in the third quarter of this year, more than any other higher-education company. And Mr. Graham has gone to Capitol Hill to argue against the regulations in private visits with lawmakers, the first time he has lobbied directly on a federal issue in a dozen years.
It never ends, WaPo should turn itself into a bank and borrow from the Fed’s discount window. They certainly pass the Fed’s ‘predatory capitalist corruption test’.
Meanwhile, nobody is willing to talk about the mystery missile launch off the LA coast the night before last. Chinese sub- launched ballistic missile, perhaps?
Bloomberg notes the alternative- energy segment is having problems due to overcapacity, particularly in Europe:
Wind turbine and solar panel makers may be vulnerable to takeovers after clean-energy stocks lost almost $400 billion in value this year and factories expanded faster than product demand, investment bankers said.
“It’s just a matter of time before we see more consolidation,” Marc Schmid, head of renewable energy investment banking at Credit Suisse AG in London, said in an interview. “With potential oversupply in solar and wind, the pressure may be rising and that could trigger more activity.”
China’s Shanghai Electric Group Co. and Dongfang Electric Corp. may follow General Electric Co., United Technologies Corp. and Siemens AG in buying companies to enter markets, analysts said. The biggest manufacturers are jockeying for position in clean power and energy efficiency that will need $9.7 trillion in capital investment through 2020, HSBC Plc has estimated.
This is the problem with fossil fuel alternatives. Rising fossil fuel costs cannibalize funds needed for alt- energy investment. Alternatively, cheap fossil fuels removed the incentives for alt- energy in the first place! This is a hurdle the industry may find it hard to climb over.
This is from the ‘Yankee Go Home!!” department: Bill McBride @ Calculated Risk takes issue with Chinese estimates of US solvency:
From the Financial Times Alphaville: US downgraded on QE2 … by Chinese rating agency (ht Andrew)
Dagong Global Credit Rating Co. — the Chinese rating agency which hit headlines earlier this year for its AA-view on the United States — is back. With a US downgrade.
From the just-published, 10-page report:
Dagong has downgraded the local and foreign currency long term sovereign credit rating of the United States of America (hereinafter referred to as “United States” ) from “AA” to “A+“, which reflects its deteriorating debt repayment capability and drastic decline of the government’s intention of debt repayment.
The serious defects in the United States economic development and management model will lead to the long-term recession of its national economy, fundamentally lowering the national solvency.
I thought this was from The Onion. The report concludes:
[G]iven the current situation, the United States may face much unpredictable risks in solvency in the coming one to two years.
I have to go with the Chinese viewpoint on this, the Greatest Minds in America right now are burning up the gray matter trying to figure out how to repudiate all that Yankee paper held by Beijing. China is nuttin’ but a massive currency trap and anyone ‘with a brain’ can see that.
What is ironic is that China downgrades itself the same time it downgrades America. It copied the US model almost to the last Buick. It also depends on the US for everything from customers for excess salad shooters to global security of the sea lanes over which its salad shooters must pass.
As the US descends down the drain of history, so goes China ..