Does Indiana Farming Face This Problem?

From the Sunday Herald from Scotland:

It is a perfect storm of four significant and inter-related events. The explosion in the price of oil to more than $100 a barrel has put great pressure on the cost of food distribution. At the same time the United States has given huge agricultural subsidies to create biofuel as a substitute in the form of ethanol distilled from corn. The use of cereals for such industrial purposes has increased by more than 25% since 2003, eating up a huge amount of land that might otherwise be used for food production.

Yet this is happening while global warming is turning large tracts of the world into arid desert, meaning millions of people face starvation as land suitable for cultivation dwindles. Meanwhile, the economic powerhouses of China and India are driving a huge spike in demand for food. China's 1.3 billion consumers will plough through more than 50kg of beef per head in 2008, compared to 20kg in 1985. This pushes up demand for grain because it takes 8kg of grain to produce just one kilogram of beef.

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As a result, the price rises in food staples were extraordinary throughout 2007. Since last spring, wheat prices have doubled and almost every crop is at or near a peak in nominal terms. The Economist's food price index is higher today than at any time since it was created in 1845. Even in real terms, prices have jumped by 75% since 2005.

This shows no signs of abating. The world's urban population is still exploding, and within the next three decades 61% of us will live in urban areas. Together with rising incomes in countries with huge populations, such as China and India, this will keep pushing up demand for high-value food products.

As if this were not going to put enough pressure on food prices, food output will also come under pressure from changing weather patterns. Far from going upwards, output in developing countries is projected to decline by 20%, while output in industrial countries is projected to decline by 6%, according to Professor William Cline of the Centre for Global Development. Most alarmingly, temperature increases of more than 3C may cause prices to increase by up to 40%, says a 2007 report by the Intergovernmental Panel on Climate Change.

The remainder of Food ... and how it's going to change the world is well worth reading and thinking about.