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EU Ministers Urge July Decision On Carbon Market – Draft
BRUSSELS | Mon May 6, 2013 11:05pm BST (Reuters) – Governments and members of the European Parliament must decide on a plan to prop up the EU carbon market by July at the latest, a joint statement from nine energy and environment ministers, said. The statement, seen by Reuters, is expected to be published officially on Tuesday to coincide with discussions among members of the European Parliament on the European Commission plan. No-one from Britain’s Department of Energy and Climate Change, which is expected to release the statement, was immediately available for comment. A proposal, known as backloading, to strengthen the Emissions Trading Scheme (ETS) by removing some of a glut of carbon allowances generated by recession was rejected by the European Parliament last month in an initial vote. The rejection followed lobbying by energy intensive industry concerned about the positive impact on energy prices, while at member state level, coal-intensive Poland has sought to block the plan. Dominant EU member state Germany has failed to agree a common position. The issue has become a political flashpoint ahead of elections later this year as the economy ministry opposes intervention and Germany’s environment minister supports it. Last week, Chancellor Angela Merkel also said backloading was necessary, but that it could not be agreed until after the German election in September. Tuesday’s statement said that was not soon enough. It called on the EU member states and parliament to “take the urgent steps necessary” to come to “a swift resolution of the backloading proposal by July of this year at the latest”. Interference in markets had to be kept to a minimum, but “a one-off and targeted intervention now would minimise market uncertainty” and promote investment in low-carbon technology, it said. Backloading was only ever meant to be an emergency fix for a market that has collapsed to a series of record lows, with carbon allowances still priced at less than four euros per tonne. The Commission has also opened debate on more sweeping reform of the market and the statement calls on the EU executive to deliver by the end of the year at the latest proposals on “a proper structural reform”. The nine signatories included British Secretary of State for Energy and Climate Change Ed Davey, as well as German Environment Minister Peter Altmaier and ministers from Denmark, Finland, France , the Netherlands, Portugal , Slovenia and Sweden. (Reporting by Barbara Lewis, editing by William Hardy) Continue reading
A Good Investment: Farmland Values Likely To Remain High
By Karen Caffarini More Content Now Posted Apr 26, 2013 @ 03:54 PM Last update Apr 26, 2013 @ 04:02 PM One area of real estate remains unscathed by the burst housing bubble: farmland. Prices continue to increase for property with prime soil, especially in the Midwest where corn is king. Farmland values have doubled in Illinois in the past five years, according to William Bailey, director of Western Illinois University’s School of Agriculture, and he doesn’t foresee any drastic drops in the future. Here are a few reasons why. Investment opportunities After the bottom fell out of housing, stock market investments plummeted and interest rates on traditional bank accounts dropped, some investors began looking to agriculture property as providing a relatively safe return, said Bradford T. Knipe, senior managing director at Integra Realty Resources in Boise, Idaho, which specializes in farm property. Many investors will buy the land and lease it back to the farmer, he said. Growth spurt The reasons that caused the last big bubble in farm values to burst in the 1980s — high interest rates, farmers owing banks large amounts of money and lower commodity prices — aren’t present now, Bailey said. “Farmers have paid off their debt, bought good equipment and are looking for places to put their money. In some cases, their neighbor’s farm might look very attractive to add to the size of their own farm,” he said. Knipe said farmers are buying either because they need more land to do what they do, or want to buy out their competition. Foreign investment Countries like China, India and Saudi Arabia are aggressively purchasing foreign farm land to ensure an ample food supply is available for their own people, Bailey said. Local farmers would still work the land; they would rent the property from the other country, he said. The determining factor in this case, however, is whether a farmer will refuse to sell to a foreign investor for patriotic reasons, Bailey said. High commodity prices Hot commodities like corn are helping boost prices for Midwest farmland higher than in the northwest area of the country, such as Idaho and Washington, Knipe said. Bailey said an ideal location and plenty of uses also help Illinois corn farmers, who can ship the golden kernels down the Mississippi River to the Gulf of Mexico and out to the rest of the world for consumption, to ethanol plants and to other farmers for livestock feed. Back to its roots When the bottom fell out of the residential subdivision market, land that would have been considered for a new housing development reverted back to its agricultural roots. “The real reason for the change was that the market viewed these lands as reverting back to their highest and best use, from development ground to ag ground,” Knipe said. Continue reading
Farmland Boom Carries Threat Of Collapse
New York Times If the price of corn falls — and many forecasters predict it will, particularly if the ethanol boom wanes — the price of U.S. farmland will fall with it. Across the American heartland, farmland prices are soaring. In places like Waco, Neb., and Chickasaw County, Iowa, where the boom-and-bust cycle of farming reaches deep into the psyche, some families are selling the land that they have worked for generations, to cash in while they can. Behind the rush is the age-old driver of farm booms: high crop prices. Corn, in particular, has been soaring, reflecting demand overseas and, domestically, for ethanol. High prices mean good profits for farmers, and many are using their growing incomes to bid for land. Sensing opportunity, investment firms are buying, too. But if the price of corn falls — and many forecasters predict it will, particularly if the ethanol boom wanes — the price of farmland will fall with it. While many farmers have borrowed little money or used cash to finance their purchases, those who have overexpanded could run into trouble, leaving banks and other creditors with their bad debts. Continue reading
