Little bits and pieces floating around out there...

First Argentina. 3rd largest soybean producer in the world, Brazil is #2, US is #1. Both Argentina and Brazil are having drought issues, Argentina more so than Brazil. 11.2008 Story on Argentina It's gotten worse since then, although they might have just gotten enough rain this last week to bail them out of having a bad crop year.

USDA in 11.2008 was projecting 2-3% increase in soybeans for Brazil and Argentina. The smart money is now betting than it's more likely in the 0-1% increase range, but now the farmers are having an increasing difficult time raising capital to plant their crops. That's going to be a concern for here in the US, also - but less of a concern than in other producing markets. Link to Article

Don't be at all surprised if there isn't a couple of bil $$$$ of our next bailout set aside for the farming community, specifically farm equipment and farm suppliers. There's logic there, in that apart from keeping the manufacturers and suppliers afloat, the money will also push the farming community to produce, and hopefully start to reverse some of last year's food price increases going forward into 2009. Smarter thinking, there - IMO.

If this happens, watch the market for productive farmland. When you've got a truly crippled up RE market, got to start the recovery somewhere. Start with that tiny corner of the RE market called "productive farmland".

Watching both the rice and wheat markets. Going to be interesting.