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How can consumption exceed production year after year? Do we have tons of stored grain that lasts for many years?

OJFord 4y ago
I'm no expert, but yes it can be stored; see also the 'stocks' section in the submission. It also seems to be implied that 'consumption' includes derivative products (which makes total sense as long as it's not double-counting). It's not continuously harvested (spring and winter crops) so there'd have to be a buffer anyway, and you wouldn't know in advance if that's going to be good bad or average. Also I assume good stock control (not necessarily just FIFO, but also relegating the good stuff to animal feed as it ages) so really running a slight deficit for several years is the same as a big deficit for one year. (Or better even - less implied risk for the next year, doesn't seem so volatile.)
hrisng 4y ago
Yeah. A majority of grain on the market is not 'new'. It's been stored for a while, either waiting for buyer, or for the right time and the right price. Most country also have a national reserve to ensure food security. And they tend to be quite trigger happy with the slightest risk to that. I'm from a major rice producing country and when the first wave of Covid hit, they block exporting right away.
- DantesKite 4y ago
  That’s very interesting. Are there any books that go into detail about this?
  - hrisng 4y ago
    Not that I know of, just from personal experience. Grains kept in good condition have ridiculously long shelf life. And for commodity crops like grains, the scale of production is just so insane that it is not possible for it to be all consumed at a short time frame after it's harvested. Also, agriculture produce's price fluctuates a lot. Farming has a long feedback time, so by the time you harvest, the state of the market is no longer the same. Anything that can be stockpiled will be stockpiled to wait for the right time. This is not normally done by the farmer themselves, but the traders. Then it's just FIFO, the oldest grains at the bottom of the silos will be taken out first.
TheAceOfHearts 4y ago
Tangentially related, the US has the world's largest stockpile of cheese [0], coming in at 1.4 billion pounds as of 2019. [0] https://www.npr.org/2019/01/09/683339929/nobody-is-moving-our-cheese-american-surplus-reaches-record-high https://www.npr.org/2019/01/09/683339929/nobody-is-moving-ou...
- civilized 4y ago
  Now that is something to be proud of.
  - sc68cal 4y ago
    Not really. It's a government subsidy for factory dairy farming, they are being paid to overproduce and then it just sits in storage going to . If we don't consume it, don't reward producing it.
    - mensetmanusman 4y ago
      Covid taught us (again) that efficiency is at odds with robustness. Having nothing in inventory is perfectly efficient, but also perfectly fragile in an environment where a major wheat producer is attacked by a madman. There has to be a balance, and cheese is easy to store and it improves with age. Being paid to “overproduce” is equivalent to being paid to add supply chain robustness in this case.
      - sc68cal 4y ago
        We have been overproducing for decades, and have had many opportunities to decrease the amount of overproduction. Certainly the government should buy surplus milk when the market fluctuates to support the industry, but I think at this point the industry is overproducing on purpose and expecting the government to purchase every bit of overproduction, to increase profits.

I'm no expert, but yes it can be stored; see also the 'stocks' section in the submission. It also seems to be implied that 'consumption' includes derivative products (which makes total sense as long as it's not double-counting). It's not continuously harvested (spring and winter crops) so there'd have to be a buffer anyway, and you wouldn't know in advance if that's going to be good bad or average. Also I assume good stock control (not necessarily just FIFO, but also relegating the good stuff to animal feed as it ages) so really running a slight deficit for several years is the same as a big deficit for one year. (Or better even - less implied risk for the next year, doesn't seem so volatile.)

hrisng 4y ago

Yeah. A majority of grain on the market is not 'new'. It's been stored for a while, either waiting for buyer, or for the right time and the right price. Most country also have a national reserve to ensure food security. And they tend to be quite trigger happy with the slightest risk to that. I'm from a major rice producing country and when the first wave of Covid hit, they block exporting right away.

DantesKite 4y ago
That’s very interesting. Are there any books that go into detail about this?
- hrisng 4y ago
  Not that I know of, just from personal experience. Grains kept in good condition have ridiculously long shelf life. And for commodity crops like grains, the scale of production is just so insane that it is not possible for it to be all consumed at a short time frame after it's harvested. Also, agriculture produce's price fluctuates a lot. Farming has a long feedback time, so by the time you harvest, the state of the market is no longer the same. Anything that can be stockpiled will be stockpiled to wait for the right time. This is not normally done by the farmer themselves, but the traders. Then it's just FIFO, the oldest grains at the bottom of the silos will be taken out first.

TheAceOfHearts 4y ago

Tangentially related, the US has the world's largest stockpile of cheese [0], coming in at 1.4 billion pounds as of 2019. [0] https://www.npr.org/2019/01/09/683339929/nobody-is-moving-our-cheese-american-surplus-reaches-record-high https://www.npr.org/2019/01/09/683339929/nobody-is-moving-ou...

civilized 4y ago
Now that is something to be proud of.
- sc68cal 4y ago
  Not really. It's a government subsidy for factory dairy farming, they are being paid to overproduce and then it just sits in storage going to . If we don't consume it, don't reward producing it.
  - mensetmanusman 4y ago
    Covid taught us (again) that efficiency is at odds with robustness. Having nothing in inventory is perfectly efficient, but also perfectly fragile in an environment where a major wheat producer is attacked by a madman. There has to be a balance, and cheese is easy to store and it improves with age. Being paid to “overproduce” is equivalent to being paid to add supply chain robustness in this case.
    - sc68cal 4y ago
      We have been overproducing for decades, and have had many opportunities to decrease the amount of overproduction. Certainly the government should buy surplus milk when the market fluctuates to support the industry, but I think at this point the industry is overproducing on purpose and expecting the government to purchase every bit of overproduction, to increase profits.