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I think it’s interesting to see how much other nations are spending on food. If you look at the graphics I’ve included below from the USDA, you can see the United States spends a smaller percentage than any other nation. To clarify, these are percentages. In an absolute sense, the United States spends more per household on food consumed at home ($2,390 per year) than, say, Nigeria ($1,343) or Russia ($1,935). But because Americans are richer, food still makes up a much smaller portion of their budgets. So as countries get richer, we find that they start spending more of their money on other things — like health care, or entertainment, or alcohol. South Koreans spent one-third of their budget on food in 1975; today that’s down to just 13 percent.

With crude oil at or near its lowest level in the past six-years, the folks over at CNBC felt it was time to examine the wholesale price of water compared to that of U.S. crude oil. What they found out might not be a surprise to those who have been predicting for several years that water would one day be more expensive than crude oil… Wake up the time is here, the average price for one gallon of crude oil is now about $1.03 per gallon vs. the average wholesale price for a gallon of water being about $1.21 per gallon. Many technical traders are keeping a close eye on the $42.00 level vs. the WTI crude contract. Thoughts are if this level doesn’t hold crude oil prices could quickly tumble into the $30’s. There are still no real major positives showing up on the demand side of the equation, while we continue to be force fed a glut of bearish headlines on the supply side. Remember, production here in the U.S. has increased by about 600,000 barrels a day this year and seems to be holding steady at about 9.4 million barrels for several months. At the same time, OPEC said its production rose to a three-year high this summer. OPEC said it pumped 31.5 million barrels a day in July, up 100,000 barrels on higher output from Iraq, Saudi Arabia and Angola. OPEC also reported a 2.87 million barrel a day oversupply in the 2nd quarter. (Source: CNBC)

According to research led by Purdue University and China Agricultural University, an important agricultural region in China is drying out and increased farming may be to blame. The study — spanning 30 years of data — found that soil moisture has decreased by 6% since 1983 in Northern China. The soil in the region is now at less than 40% of its water holding capacity, while the optimal moisture levels are typically 40% to 85%. Researchers believe if this trend continues, the soil may not be able to support crops by as early as 2090. Understand, 40% of the nation’s population resides in Northern China and the region accounts for 65% of the nation’s cropland. What’s most interesting about this study is that usually when you see soil moisture losses, its due in a large part from changing climate — rising temperatures and less rain. However, this study suggests water depletion appears to be largely driven by human agricultural activities. The study lasted from 1983 to 2009 at two sites, one agricultural and another at an unspoiled grassland. A significant drying trend was discovered in the soil moisture of the agricultural site while a slight increase in moisture was recorded in the grassland. A consistent trend in decreasing of soil moisture correlated with increased usage of fertilizers. The researchers explain that fertilizer has long been overused in China, which accounts for 31.4% of global consumption. In addition to increased fertilizer usage, increasing soil irrigation, caused by the heightened demand for water of newly developed crop species, also leads to increased draw upon the surface and groundwater resources. Drying soil in Northern China has been well studied, but the impacts of agricultural intensification in general on this region have been little understood. The researcher believe their study shows a clear correlation with increased fertilizer usage and proliferation of crops with high water demands though, and say it underscores the importance of developing sustainable agricultural practices. It’s clear the Chinese government recognizes the problem,​as they actually sanctioned the study. The question is whether the government is ready to do something? ​Food security remains one of the state’s paramount concern​s, so ​promot​ing​ agricultural approaches that might decrease production​ may have a tough time gaining any traction.​ ​Overall​,​ ​the ​problem really​ is an​ enormous​ one​, ​and it needs to be addressed sooner rather than later as the depleted soil and water resources will take years, even decades to recover.

Gas prices fell another six cents last week, with the average national price at $2.65 per gallon as of yesterday. Prices have been steadily declining since hitting their 2015 peak back in June, but several regions continue to experience supply issues. States west of the Rockies remain the most expensive with prices in those 7 states still topping $3. Alabama has the nation’s cheapest gas at $2.266 per gallon. The average price for retail gasoline remains significantly discounted versus this same date last year, down by 75 cents in most states. AAA thinks prices could fall another 15 cents per gallon this summer, with some states even getting back down to the $2.00 level by the end of the year. Click on the graphic for a bigger view. (Source: AAA)