Sighted Moon News Letter 5844-002
5th day of the First month 5844 After Creation
April 12, 2008
Shabbat Shalom Family,
we have had a lot of studies this winter. Many of you are even taking these subject to your home groups and studying them out there. Awesome.
This week I have one for you that will upset many of you who are basing your belief’s on religion and not biblical facts. It is time that some of you get outside the box you are in and take a real hard look at what you have been doing all our life.
The bible explains so many things. All you have to do is read it.
While on the Prophecy Club speaking tour I was confronted with a problem in Milwaukee. My second city. There was a guy who was laughing and poking fun at the things I was saying. I went up to him at the first break and inquired as to what he thought.
He explained to me that he did not have to obey the law as Jesus had died for his sins and therefor he was no longer under the law.
In the questions after was another man who also wrote off all I had explained by using the same line. Jesus died for his sins and he was not or did not have to obey the law.
I did not have an answer at that moment. But before I spoke again in Detroit I did have the answer. When I presented this truth in Lansing, it caused some of them to be upset with the teachings and was what haunted me the rest of the speaking tour. Some of those in Lansing were trying to have the tour cancelled because of this.
Yeshua died on the tree and as both these gentlemen said He died in fulfillment of the law. What law did Yeshua fulfill? He was executed for something. Although HE in truth did not break any law, HE was punished according to the law. This is how He fulfilled the law.
First we need to know what did the Pharisees say HE did to be worthy of death.
We can read in John 8:57 Then the Jews said to Him, “You are not yet fifty years old, and have You seen Abraham?” 58 Jesus said to them, “Most assuredly, I say to you, before Abraham was, I AM.”
59 Then they took up stones to throw at Him; but Jesus hid Himself and went out of the temple, going through the midst of them, and so passed by.
Here we are told that Yeshua claimed to be the I AM. That He was in fact the Creator. And they sought to kill Him.
Again in John we are told that the Jews wanted to kill Him for Blasphemy.
John 10: 24 Then the Jews surrounded Him and said to Him, “How long do You keep us in doubt? If You are the Christ, tell us plainly.” 25 Jesus answered them, “I told you, and you do not believe. The works that I do in My Father’s name, they bear witness of Me. 26 But you do not believe, because you are not of My sheep, as I said to you. 27 My sheep hear My voice, and I know them, and they follow Me. 28 And I give them eternal life, and they shall never perish; neither shall anyone snatch them out of My hand. 29 My Father, who has given them to Me, is greater than all; and no one is able to snatch them out of My Father’s hand. 30 I and My Father are one.”
Renewed Efforts to Stone Jesus
31 Then the Jews took up stones again to stone Him. 32 Jesus answered them, “Many good works I have shown you from My Father. For which of those works do you stone Me?” 33 The Jews answered Him, saying, “For a good work we do not stone You, but for blasphemy, and because You, being a Man, make Yourself God.” 34 Jesus answered them, “Is it not
written in your law, â€˜I said, “You are gods” 35 If He called them gods, to whom the word of God came (and the Scripture cannot be broken), 36 do you say of Him whom the Father sanctified and sent into the world, â€˜You are blaspheming” because I said, “I am the Son of God” 37 If I do not do the works of My Father, do not believe Me; 38 but if I do, though you do not believe Me, believe the works, that you may know and believe that the Father is in Me, and I in Him.” 39 Therefore they sought again to seize Him, but He escaped out of their hand.
At the trial we are told that He was also accused of Blasphemy.
Matt 26: 59 Now the chief priests, the elders, and all the council sought false testimony against Jesus to put Him to death, 60 but found none. Even though many false witnesses came forward, they found none. But at last two false witnesses came forward 61 and said, “This fellow said, “I am able to destroy the temple of God and to build it in three days.” 62 And the high priest arose and said to Him, “Do You answer nothing? What is it these men testify against You?” 63 But Jesus kept silent. And the high priest answered and said to Him, “I put You under oath by the living God: Tell us if You are the Christ, the Son of God!” 64 Jesus said to him, “It is as you said. Nevertheless, I say to you, hereafter you will see the Son of Man sitting at the right hand of the Power, and coming on the clouds of heaven.” 65 Then the high priest tore his clothes, saying, “He has spoken blasphemy! What further need do we have of witnesses? Look, now you have heard His blasphemy! 66 What do you think?” They answered and said, “He is deserving of death.” 67 Then they spat in His face and beat Him; and others struck Him with the palms of their hands, 68 saying, “Prophesy to us, Christ! Who is the one who struck You?”
To answer those two gentlemen and others who hold to the line that Yeshua fulfilled the law, we need to know what law was fulfilled. We have now just learned that the law that he was accused of breaking was Blasphemy.
Another law that he was said to have broken was that He healed on the Sabbath.
Now lets look in the book of the law to see how these laws when broken were punished.
Lev 24:10 Now the son of an Israelite woman, whose father was an Egyptian, went out among the children of Israel; and this Israelite woman’s son and a man of Israel fought each other in the camp. 11 And the Israelite woman’s son blasphemed the name of the LORD and cursed; and so they brought him to Moses. (His mother’s name was Shelomith the daughter of Dibri, of the tribe of Dan.) 12 Then they put him in custody, that the mind of the LORD might be shown to them. 13 And the LORD spoke to Moses, saying, 14 “Take outside the camp him who has cursed; then let all who heard him lay their hands on his head, and let all the congregation stone him. 15 “Then you shall speak to the children of Israel, saying: â€˜Whoever curses his God shall bear his sin. 16 And whoever blasphemes the name of the LORD shall surely be put to death. All the congregation shall certainly stone him, the stranger as well as him who is born in the land. When he blasphemes the name of the LORD, he shall be put to death.
22 You shall have the same law for the stranger and for one from your own country; for I am the LORD your God.” 23 Then Moses spoke to the children of Israel; and they took outside the camp him who had cursed, and stoned him with stones. So the children of Israel did as the LORD commanded Moses.
Number 15: 32 Now while the children of Israel were in the wilderness, they found a man gathering sticks on the Sabbath day. 33 And those who found him gathering sticks brought him to Moses and Aaron, and to all the congregation. 34 They put him under guard, because it had not been explained what should be done to him. 35 Then the LORD said to Moses, “The man must surely be put to death; all the congregation shall stone him with stones outside the camp.” 36 So, as the LORD commanded Moses, all the congregation brought him outside the camp and stoned him with stones, and he died.
The Penalty for Blasphemy was Death. The Penalty for Working on the Sabbath was Death. We have just read this.
The penalty for death was always by stoning. Lev 20: 27, Duet 13:10, 17:5, 21:21, 22:24. In each of these cases the Penalty of death was to be carried out by the whole community and it was to be done by stoning.
Here is what Yeshua said about it, Mat 21:36 And the vine dressers took his servants, beat one, killed one, and stoned another.
Then in verse 37 it says the King sent His son and his son they did like wise. Who is the son that Yeshua is talking about and what did they do to Him? They beat Him Stoned and killed Him.
Again in Matt 23:37 “O Jerusalem, Jerusalem, the one who kills the prophets and stones those who are sent to her! How often I wanted to gather your children together, as a hen gathers her chicks under her wings, but you were not willing!
Even the Apostles were concerned about it as we can read in John 11:8 The disciples said to Him, “Rabbi, lately the Jews sought to stone You, and are You going there again?”
The Jews had tried to stone Yeshua on two occasions and the crime Yeshua was accused of was Blasphemy and working on the Sabbath. Both of which are punishable by stoning. But when they took Him to Pilot they had accused Him of Blasphemy.
Luke 22:70 Then they all said, “Are You then the Son of God?” So He said to them, “You rightly say that I am.” 71 And they said, “What further testimony do we need? For we have heard it ourselves from His own mouth.”
With that they took him to pilot to have Him killed. But Pilot found no fault in Him. Just as the High priest was to find no fault in the Lamb that was to be killed on Passover.
Pilot then said the Pharisees, John 18:31 â€˜you take Him and judge Him according to your law.
John 19:7 The Jews answered him, “We have a law, and according to the law He ought to die, because He made Himself the Son of God.”
And by this statement I can attest that the law He was found guilty of was blasphemy and the punishment for blasphemy is death by stoning. THAT IS ACCORDING TO THE LAW HOW HE OUGHT TO DIE.
According to the law He is to die by stoning!
There is yet more to this.
In Galatians 3:13 Christ has redeemed us from the curse of the law, having become a curse for us (for it is written, “Cursed is everyone who hangs on a tree”*), which is taken from Duet. 21:23. his body shall not remain overnight on the tree, but you shall surely bury him that day, so that you do not defile the land which the Lord your God is giving you as an inheritance; for he who is hanged is accursed of God.
Are you aware that there is no law to ever hang a man on a tree. All death penalties were by stoning. Never by hanging. But here we have a law not to leave a man on a tree over night, as told to us in Duet 21:23.
Here also in Galatians Paul has just told us that Yeshua became accursed. Accursed is the man who hangs on a tree.
The importance of this is understanding what happened to Achan which we can read in Joshua 7. Achan had taken some things from Jericho which they were told not to touch lest they become accursed. Because of this Israel lost the next battle of Ai.
When it was learned that Achan had taken these things, all his possessions, including his kids and his wife and all his livestock were taken and all of them stoned to death and then burned to purify the land of the curse.
Yeshua was accursed for our sins. He was accused and found guilty of blasphemy. The penalty for both was stoning.
This is why pilot found it so incredible that Yeshua had died so quickly when the other two criminals were not yet dead.
This is also why Joseph of Arimathea raced to Pilot to claim the body. Why you may ask. Those things that were accursed were not to be touched by any one lest they became accursed too. As was done with Achan and his family and herds, Yeshua most likely would have been burned up.
One last source as proof. And it comes from the Sanhedrin 43a of the Talmud
” On the eve of the Passover Yeshua the Nazarean was hanged. For forty days before the execution took place, a herald went froth and cried, â€˜He is going forth To Be Stoned because he has practiced sorcery and enticed Israel to apostasy. Any one who can say anything on his favor, let him come forward and plead on his behalf.” But since nothing was brought forward in his favor he was hanged on the eve of Passover.”
Right here in the Talmud it says that Yeshua was to be stoned. Yet most think that Yeshua died when the spear was stuck in him. Is that true?
Again lets read what the scriptures say John 19: 31 Therefore, because it was the Preparation Day, that the bodies should not remain on the cross on the Sabbath (for that Sabbath was a high day), the Jews asked Pilate that their legs might be broken, and that they might be taken away. 32 Then the soldiers came and broke the legs of the first and of the other who was crucified with Him. 33 But when they came to Jesus and saw that He was already dead, they did not break His legs. 34 But one of the soldiers pierced His side with a spear, and immediately blood and water came out.
He was already dead.
Yeshua fulfilled the law. He was killed according to the law. He was killed by stoning. This is the law He fulfilled. Now when you read Isaiah 53, many of the things said there will make more sense.
On another note, some are wondering why Yeshua cursed the fig tree. It has bothered me for some time. In the early spring of the year why would any tree have any fruit on it. It is spring time. There would not normally be fruit on that tree or any tree until at least summer or until the fall.
So why did HE curse the fig tree.
In the garden of Eden were two trees. One was the tree of Life and the other the tree of the Knowledge of Good and Evil.
When Adam and Eve sinned by eating the fruit of the tree of the Knowledge of Good and Evil, the first thing they did was what?
Gen 3:7 Then the eyes of both of them were opened, and they knew that they were naked; and they sewed fig leaves together and made themselves coverings.
As soon as they had ate of the tree they knew they were naked. The closest tree to make coverings would have been the tree they were standing under would it not? The Fig tree. This is how the Jews have concluded as do I that the tree of Knowledge of Good and Evil was represented by the fig tree. It was symbolic of Satan’s way of life.
Yeshua had the tree cursed so that He would not be hung on that tree to be killed. If Yeshua was hung on the fig tree Satan would have claimed a victory.
Matt 21: 17 Then He left them and went out of the city to Bethany, and He lodged there.
The Fig Tree Withered
18 Now in the morning, as He returned to the city, He was hungry. 19 And seeing a fig tree by the road, He came to it and found nothing on it but leaves, and said to it, “Let no fruit grow on you ever again.” Immediately the fig tree withered away.
The Lesson of the Withered Fig Tree
20 And when the disciples saw it, they marveled, saying, “How did the fig tree wither away so soon?” 21 So Jesus answered and said to them, “Assuredly, I say to you, if you have faith and do not doubt, you will not only do what was done to the fig tree, but also if you say to this mountain, “Be removed and be cast into the sea,” it will be done. 22 And whatever things you ask in prayer, believing, you will receive.”
But instead Yeshua was hung on the tree of life. Which tree was that? I am going to say it was the Almond tree. I base this on the fact that Aaron’s rod was made from the Almond tree. The Menorah was made to look like an almond tree.
I am also claiming that all three, Yeshua and the two thieves were hung on the same tree.
As Yahweh sat on the Mercy seat in the Temple and looked towards the East, He would have seen His beloved Son hanging on the tree with His arms stretched upwards. The other two would have been on the same tree with their arms also stretched upwards. From the temple this would have looked like the Menorah which was in the Temple.
This precludes that Yeshua was not hung on a cross. To learn more about the pagan roots of the crucifix, that so many of you were thinking that you are showing your Christian loyalty by wearing them, please go and read this article from Hislop at The Cross http://www.piney.com/His56.html
After doing that you will want to throw out all your crucifixes that adorn your neck and walls of you home. Worship Yahweh in truth and stop believing in a lie.
But we have yet to prove what Yeshua was actually hung on. Yes the tree.
Acts 5:30 The God of our fathers raised up Jesus whom you murdered by hanging on a tree.
Acts 10:39 And we are witnesses of all things which He did both in the land of the Jews and in Jerusalem, whom they killed by hanging on a tree.
Acts 13:29 Now when they had fulfilled all that was written concerning Him, they took Him down from the tree and laid Him in a tomb.
Gal 3:13 Christ has redeemed us from the curse of the law, having become a curse for us (for it is written, “Cursed is everyone who hangs on a tree” ),
1Pet 2:24 who Himself bore our sins in His own body on the tree, that we, having died to sins, might live for righteousness by whose stripes you were healed.
What about the cross that is written in the scriptures?
All scriptures must work together. You can not cast some out to fit your own theology. The cross was a stake or piece of wood that the accused was nailed to. It went a cross the shoulders from hand to hand. It was not a T shaped object as most now think. Read the article by Hislop.
It went from one hand across to the other hand. Yeshua was nailed to this. This was hosted up and nailed to the tree. His feet were then nailed to the tree most likely in the same fashion a hunter would hang a deer, by the tendon.
We are not yet done. I have more information to share with you.
John 19:17 And He, bearing His cross, went out to a place called the Place of a Skull, which is called in Hebrew, Golgotha, 18 where they crucified Him, and two others with Him, one on either side, and Jesus in the center. 19 Now Pilate wrote a title and put it on the cross. And the writing was:
Yeshua of Nazareth, King of the Jews.
20 Then many of the Jews read this title, for the place where Jesus was crucified was near the city; and it was written in Hebrew, Greek, and Latin.21 Therefore the chief priests of the Jews said to Pilate, “Do not write, “The King of the Jews,” but, “He said, “I am the King of the Jews.”” 22 Pilate answered, “What I have written, I have written.”
What is going on here that is so interesting?
When you read it in Hebrew and then take the first letter of each word, it spells out the name of YHVH
I have also read that this is not grammatically correct. It does make for interesting reading though.
When you consider all that I have shared here, then you can understand why, it has been the past two year, and it will be again this year, Yahweh willing, that I will be once again sleeping where Yeshua prayed in the garden on the Mount of Olives. I will be eating only feet away from the very spot where He was killed. On a tree. That I will be conducting a study at the very tomb of Joseph of Arimathea. And I will be pondering exactly where the Temple once stood directly across from me over the Gihon Spring where I will again mikvah this year.
If you want to join me you need to act fast as rooms are getting full. The cost is only about $600. You must look after your own air fair. A valid passport that does not expire until a least six months after the Feast is needed.
There is limited space and we will have a very small group. I need to know very soon though. This is to be my last invitation to join us this year at our Fathers House in the Land of Israel.
The Following is an agricultural report on the expected crop plantings in the USA and how the commodities are in the world. I have highlighted in red those sections I consider very important.
I am showing this to you as we near the time of the third curse of Leviticus 26. Pestilence and famines are to occur. Please read the following and then watch the news over the course of this next year. Are there people in parts of the world with no wheat for the nations people?
Potential US Grain Supply/Demand Outlooks for 2008-09 Based on March 31 Planting Intentions â€“ Mike Krueger
The table below is an updated version of the table we published back on March 17th, two weeks before the USDA’s acreage estimates were released. This table reflects the new acreage estimates and also includes adjustments expected from the quarterly stocks report
US Corn/Soybean/Wheat Supply/Demand Outlook (million bushels)
Last Year’s Numbers Are in ( )
CORN SOYBEANS WHEAT
Planted Acres 86 (93.6) 74.8 (63.6) 63.8 (60.4)
Harvested Acres 78.8 73.7 54.5
Yield/Acre 155 (151.1) 42 (41.2) 41 (40.5)
Production 12,215 (13.1) 3,095 (2.6) 2,234 (2.067)
Carry In 1,188 180 272
Imports 0 0 90
Total Supply 13,418 3,275 2,596
Feed/Seed/Resid 6,000 180
Total Domestic 11,00 2,030 1,200
Exports 2,100 950 1,000
Total Use 13,100 2,980 2,200
Ending Supplies 318 (1.188) 295 (180) 39(272)
Corn: Bob Kohlmeyer revised the corn numbers on Tuesday of this week. The
USDA’s planted acreage estimate was right on the 86 million number we used two weeks ago (that dart scored). The second (and just as significant) adjustment was the sharp decline in the March 1st stocks number of nearly 200 million bushels. We reduced expected ending supplies in this marketing year from 1.4 billion bushels to 1.188 to reflect this stocks number. That leaves the ending supply projection for the 2008-09 marketing year at just 318 million bushels. That can’t happen. Ending supplies simply can’t drop to that level. One of three things will have to happen. We must increase acres, increase the yield, or reduce demand. It is very probable that final corn planted acres will be two million above this estimate as John Baize wrote this week. The corn/soybean price ration has narrowed significantly since the acreage survey was taken. It will be hard to justify a bigger yield estimate since it now appears certain there will be little, if any, corn planted early. That leaves demand as about the only category that could be reduced and it will take further price gains for corn to ration demand, since we still see little evidence that today’s record high prices have done much to slow demand. Livestock numbers in this country remain very big. Ethanol profits are still good enough to justify the 4 billion bushel number used for ethanol demand. In fact, ethanol profits today are the best in many months. Our export number reflects a 350 million bushel decline from the current (record) year’s 2,450 number. There is reason to doubt we can reduce exports this much with China potentially becoming a net corn importer. The point is that corn has retaken the commodities driver’s seat, much as it did two years ago. The corn market MUST have a US corn yield of 155 or higher or things will get extremely crazy. The rapidly changing corn outlook two years ago brought us the 14 million acre increase in 2007 corn plantings. That also cut soybean plantings and supplies from record large to almost record small levels in one marketing year. The big shift this year from corn to soybeans will have to be reversed in 2009 “but to an even greater extent than last year. This scenario has big implications for all other US crop acres. The arc of the acreage pendulum isn’t getting smaller, it appears it could be getting bigger. You can paint a strong case that corn will have to have 96 to 98 million acres in 2009. That means that other crops, notably soybeans, will have to give up10 to 12 million acres in 2009.
Soybeans: The 70 million bushel increase in the expected March 1st soybean stocks took much of the edge off of the very tight old crop US supply outlook. The farmer strike in Argentina and now the port strike in Brazil will cushion some of that by pushing more old crop demand to the US, but the larger March 1 stocks coupled with a planting estimate well above the range or pre-report guesses has put the bullish soybean market on hold â€“ at least for now. The fact is, though, that even with greater supplies and more acres than expected, the US soybean ending supply outlook still doesn’t increase to a number we consider bearish, especially in today’s market environment. Since we believe corn will likely regain two million acres from the March 31st report, we must assume that most of those acres will come from soybeans. It is also possible that we won’t see as many double cropped soybeans in the Delta if weather stays wet and the wheat harvest is somewhat delayed. A 1.5 million acre decline in soybean acres at 42 bushels an acre would result in projected ending supplies dropping from our guess of 295 million bushels to 232 million bushels. That is not bearish and means weather and yields are still critical. The soybean problem will come to the fore again in 2009 based on our discussion of the potential demand for corn acres next year. Soybeans can’t afford to concede many acres to corn in 2009 without taking ending supplies down to impossibly small levels.
Wheat: The wheat market has been dominated for the past month by talk of a huge world wheat crop and a much bigger US wheat crop than last year. Our only disagreement with these bearish assessments is a matter of degree. My world wheat production forecast has been in the 635 to 640 MMT range for months. We have seen some estimates as high as 660 MMT’s. Numbers that big are unreasonable and reflect bearish hopes rather than at least some semblance of reality. The previous record world wheat crop was 627 MMT’s. Some of the reasons I still think 640 MMT’s will be the best possible scenario are:
1. India will be lucky to produce 72 MMT’s compared to the 78 being touted by several. It didn’t rain across major portions of their wheat acreage.
2. Much of North Africa is still mired in drought.
3. Turkey has some significant drought concerns.
4. Not all of the Black Sea and eastern European crop regions are enjoying perfect conditions.
5. The US wheat crop will not be as big as expected.
6. Much of Canada’s spring wheat region is also very dry and will need rains in the next 30 days. There is still plenty of time for planting conditions to improve across western Canada, but it hasn’t happened yet.
Nonetheless, world and US wheat supplies will be much better than this year, but ending supplies will still be among the smallest ever. My guess is that US wheat ending supplies will remain below 400 million bushels. The dry conditions in the US HRW region are expanding, not contracting. At least 50% of the US HRS region is still extremely dry, although it is still early in this region and rains can change this outlook quickly. I also believe the March 31st HRS acreage estimate is too big. Much of the steep increases in the prices for many minor crops (sunflowers, etc.) came after the planting surveys were completed. I am also seeing acreage shift away from wheat and soybeans and back to corn in the eastern Dakotas and western Minnesota. I am also not convinced that US wheat exports will decline to the level reflected in the above table (950 million bushels). It seems logical to expect world wheat consumers will want to rebuild some reserve stocks if prices do break considerably from current levels. The anticipated high price for corn should also mean we will feed much more wheat in the US and around the world than we did in the last 18 months. The US SRW crop should be huge. This, coupled with some potential yield issues with the HRW and HRS crops, should bring the protein spreads to the fore again in the new marketing year. KC and Mpls futures should both move to significant premiums to Chicago in the months ahead.
The last issue that could again have a significant impact on markets in the year ahead will be the politics of high food prices and the inflationary pressures that will cause. A number of significant exporting countries restricted their exports this year in an effort to hold down domestic food and feed prices. That must create some doubt among importers about the true availability of agricultural commodities even should world production and supplies expand in the next marketing year.
Please take note this is from an investment journal.
Oil, Water and Wheat …
by Sean Brodrick
If you think you know what water is worth … what wheat is worth … and what oil is worth … check out the latest news from Saudi Arabia …
The Kingdom is going to start importing wheat early next year â€” 250,000 tons by next spring. The reason is simple: They need to save water.
Underground water levels in Saudi Arabia are dropping by at least 16 feet a year in areas of “heavy” cultivation, according to a U.S. government report.
Eventually, the Saudis will probably import all their wheat â€” about three million tons a year.
This could get expensive â€” the price of wheat has more than doubled in the past year.
But the Saudis don’t care about the price of wheat because …
Water Is Much More Precious
Than Oil in the Middle East
The Saudis get most of their water from aquifers which are being replenished at only about 10% of the extraction rate. Desalinization has its limits and even though the government picks up the fuel tab, a new desalination plant costs about $200 billion.
Most of the Kingdom’s water use â€” over 80% â€” is for food. And Saudi Arabia isn’t the only Middle East country with an empty bowl to fill.
Egypt, the world’s second-largest wheat importer, saw its wheat imports jump 43% to 5.2 million tons in the first eight months of the year that began July 1.
The Middle East’s most populous nation imported seven million tons of wheat last year, half its annual consumption. Bread riots in Egypt killed at least two people recently.
Arab countries have less than 5% of the world’s population and control over 40% of the world’s oil supply. However, they get only 2% of the world’s rainfall and have only 0.4% of the world’s recoverable water resources.
Their populations are booming â€” which means the water has to serve more and more people. So it gets tougher for these countries to feed themselves.
In the end, it’s a global problem:
Worldwide supplies of wheat will fall to 110.4 million tons by the end of the marketing year on May 31, the lowest levels in 30 years.
U.S. stockpiles may drop to 6.6 million tons, a 47% drop from the prior year, according to the U.S. Department of Agriculture.
Other grain supplies are dwindling, too. Soybean stocks are at a 35-year low, and world rice inventories are at the lowest level since the 1970s.
The Era of Cheap Food Is Over
Over the past eight years, the price of food worldwide has increased 75%; the price of wheat has gone up a dramatic 200%.
And the rate of inflation is accelerating. In a recent report, the United Nations predicted that food prices are likely to remain high for a decade.
Here are some facts …
Â· As of December, 37 countries faced food crises, and 20 had imposed some sort of food-price controls.
Â· The prices of the world’s three main grains â€” rice, wheat and corn â€” have all more than doubled in the past year.
Â· Part of rising food prices is due to rising fuel prices â€” as the Saudis raise the price of oil they sell us, we’re going to be raising the price of wheat we sell them.
Â· Another part of the equation is weather. Extreme weather shifts over the past two years have reduced the worldwide wheat harvest by nearly 10%. And it’s not just wheat. Since 1971, in the United States, droughts or floods have wiped out up to a third of the Midwest corn crop four times.
Â· Wheat production in South America and Western Europe has been cut from 5% to 20% in each of the past two growing seasons.
Â· Australia was once the second-largest exporter of grain, harvesting about 25 million tonnes in a good year. But the worst drought in a century reduced the crop to only 9.8 million tonnes in 2006 and 13.1 million tonnes in 2007.
Now, this year could be different. If good weather holds, we could see a record world wheat crop. And just this week, we saw grain prices tumble as the government reported that farmers are planting from fence to fence.
On the other hand, people in China and India are changing their diets â€” eating more and better food.
The Chinese ate just 44 pounds of meat per capita in 1985. They now eat over 110 pounds a year. Each pound of beef takes about seven to 10 pounds of grain to produce, which puts even more pressure on grain prices.
In fact, over the next decade, according to tentative UN and OECD forecasts made in February, the price of corn could rise 27%, oilseeds like soybeans by 23% and rice by 9%.
U.S. consumers know that food prices are already rising. The Bureau of Labor Statistics reports that ground beef, milk, chicken, apples, tomatoes, lettuce, coffee and orange juice are among the staples that cost more these days.
At $1.32, the average price of a loaf of bread has increased 32% since January 2005. In the past year alone, the average price of a carton of eggs is up nearly 50%.
Overall, food prices rose nearly 5% in 2007, according to the U.S. Department of Agriculture, and should rise by at least that much this year, too.
A survey by the Food Marketing Institute showed the average number of weekly shopping trips falling below two per household for the first time. Food banks are seeing increases in their overall client loads.
Who Is Going to Feed
A Hungry World? The U.S.!
Demand for U.S. wheat supplies has increased 51% since June 1, compared with the same period a year earlier, USDA data show. Wheat was the fourth-biggest U.S. crop in 2007, valued at $13.7 billion, behind corn, soybeans and hay.
In fact, the U.S. accounts for a whopping 40% of the world’s grain exports. You can say that we’re “the Saudi Arabia of grain.”
So everything balances out, right? Well, not exactly. You see, as it turns out …
The U.S. Has a Worsening Water Problem, Too!
Agriculture takes a lot of water in the U.S., accounting for 80% of the nation’s consumption, and over 90% in many Western states.
The Colorado River is the main source of water for many people in the West. If its volume decreases due to climate change, 25 million people are going to have a serious problem.
Bad news: Experts expect a warming climate will reduce the flow of the Colorado River. And if we get a serious drought … well, who knows?
And it’s not just the West we have to worry about. The U.S. government projects that at least 36 states will face water shortages within five years because of a combination of rising temperatures, drought, population growth, urban sprawl, and just plain old waste.
Like Saudi Arabia, we have to look beyond household consumers to agriculture. While just 16% of all harvested cropland in the U.S. is irrigated, this acreage generates nearly half the value of all crops sold.
That brings me to the Ogallala Aquifer. This underground reservoir of water was filled up during the last ice age with enough water to fill Lake Superior. The Ogallala is under eight U.S. states â€” parts of South Dakota, Nebraska, Wyoming, Colorado, Kansas, Oklahoma, New Mexico, and Texas.
There’s another name for the states overlying the Ogallala Aquifer â€” “America’s breadbasket.” Corn, wheat and soybeans grow in those states, along with herds of livestock.
Now for the troubling news: The Ogallala Aquifer is being drained at a rate of 12 billion cubic meters per year. To date, that works out to a total depletion equal to the annual flow of 18 Colorado Rivers. Some estimates say the Ogallala will dry up in as little as 25 years!
Here’s the Good News: There Are
Great Companies Working on These Problems!
There are firms trying to find grains that will grow with less water, and solve all the other problems I mentioned today. Not only is that good news for the planet, it’s also good news for investors looking to help out and possibly make big profits in the process.
You’ll find some of these innovative companies in the Market Vectors Agribusiness ETF (MOO).
What about the water problems? Well, you could buy one of the water ETFs that hold a basket of stocks of companies involved in the production, treatment and distribution of water.
An example would be Power Shares Water Resources Portfolio (PHO). It holds everything from French water distribution giant Veolia Environment to drilling and construction firm Layne Christensen.
Look, I think oil and water … and wheat … are all in major supply/demand squeezes that aren’t going away anytime soon. I expect them all to trend higher in 2008 and beyond. And I think investors need to position their portfolios accordingly. The pullback we’re seeing now is probably one heck of a buying opportunity!
Yours for trading profits,
About Money and Markets
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