"Jim Webster" wrote in message
...

"Torsten Brinch" wrote in message
...
On Wed, 06 Aug 2003 07:29:29 GMT, "Gordon Couger"
wrote:

That's true. However, if you look at prices in USA of, say,
bread and cereals, or meat, they too are not the cheapest
on the planet.


as world grain prices are dependent on what the USA is willing to let
grains
go for, if the US wants US bread to be the cheapest on the planet they can
probably arrange it purely by cutting down their exports

Very little of the wheat enters movement hands so it has little say in how
much we export except to countries they lend money to so they can buy wheat.

The only way the government has of acquiring wheat is thought the Commodity
Credit Corporation in taking wheat in for collateral for loans and the
producer not redeeming the wheat at the end of the loan period or buying it
on the open market. When storage costs are 2 cents a month and interest is 1
percent a month the recent market makes it much more profitable to sell the
wheat at harvest and take the payment between market price and target price
and if you want to hold wheat buy a futures contract or an option that
doesn't cost storage or interest. The futures contract does have margin
calls if the price goes against you.

Gordon