We're used to watching the price of oil mock gravity, but there's an even more essential commodity that's also become scarcer and pricier in recent months: Traders are paying record prices for wheat on world markets, thanks in part to shortages caused by a mix of drought and flooding. Canada, the second-biggest wheat producer after the U.S., looks set to harvest its smallest crop in five years, due to an unusually dry July, while production in the European Union may be down nearly 40% from last year. Growing global demand for biofuels is also eating up grain production, and boosting prices.
As a result of the supply squeeze, global inventories of wheat are expected to fall to their lowest level in 26 years, according to the U.S. Department of Agriculture.
If the world warms as expected over the coming decades, the terrible farming year of 2007 may be just the beginning. As temperatures rise, many studies predict that crop yields will decline, as the extreme droughts and floods that damaged this year's wheat crops become more common. The most fertile areas are likely to be found further north in response to the heat, opening up the possibility of agriculture in territories such as Siberia.
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