Helping you navigate the new normal since 2001
The Strait of Hormuz has never been closed before. So we are in uncharted waters. And President Trump’s plan to provide naval escorts to reopen it, creates a new element of risk. What would happen if an Iranian drone hit a US warship?
Middle East turmoil highlights risks to energy and food supply – and Saudi’s water Read More
Food prices have stayed high due to the disruption caused by the war. They are unlikely to fall back quickly as the war continues and economic volatility intensifies.
Food prices set to remain volatile as the war continues and fertilizer costs remain high Read More
As the World Food Programme warns, “High fertilizer prices could turn the current food affordability crisis into a food availability crisis, with production of maize, rice, soybean and wheat all falling in 2022.”
Food prices hit record level as fertilizer costs/availability reduce farm output Read More
Food shortages and price rises are inevitable next year. So we all need to reduce the 25% of food now thrown away each year in the developed world. And in the developing world, we need to reduce the 25% lost due to logistics and storage failures. The less we waste, the more there will be to eat.
It’s going to be a very difficult winter. Most of the world will be impacted as Europe bids up energy/food prices to keep its people warm and fed. And it would never have happened if policymakers had recognised the importance of geopolitics, energy markets and demographics.
The problems began with the supply chain crisis caused by the pandemic. Russia’s war in Ukraine then created a further challenge. And now we face the risk of famine as fertiliser costs become unaffordable. Central bankers at their annual Jackson Hole get-together should therefore focus on preparing for the arrival of a potential Fourth Horseman of the Apocalypse, in the shape of a major financial crisis.
Jackson Hole is a chance to prepare for a financial shock Read More
Consumer sentiment is already at all-time lows. Rising energy, transport and food prices will likely soon push inflation above 10%, and interest/mortgage rates to 5%+, adding to the risk of a major and long-lasting downturn.
Essentially, the problem is a timebomb which is set to explode next winter unless governments work together to increase arable planting, establish emergency stocks, and subsidize fertilizer costs whilst gas prices remain at today’s record levels.