U.S. farmers finally flourishing financially, but what does it portend for the world?

A front-page story on yesterday's New York Times, A Global Need for Grain that Farmers Can't Fill, attracted a lot of attention. It's about how the increasing demand for grain world wide is leading to a boom for farmers -- whatever they choose to plant is valued much more highly than in recent years. Wheat prices, for example, have doubled in the past six months.

The story features Dennis Miller, who farms 2,760 acres in North Dakota. His family has farmed the Great Plains for over a century, which means he represents a dying breed of intergenerational family farmers. Suddenly, he's beside himself with options as he contemplates what to plant come the spring thaw. Journalist David Streitfeld writes of the implications for rural America:

At a moment when much of the country is contemplating recession, farmers are flourishing. The Agriculture Department forecasts that farm income this year will be 50 percent greater than the average of the last 10 years. The flood of money into American agriculture is leading to rising land values and a renewed sense of optimism in rural America.

“All of a sudden farmers are more in control, which is a weird position for them,” said Brian Sorenson of the Northern Crops Institute in Fargo, N.D. “Everyone’s knocking at their door, saying, ‘Grow this, grow that.’ ”

But while this is good news for U.S. farmers, the imbalance between food supply and demand means high prices in the developing world, which is driving the increased demand. Talk about the link between the global and the local . . . Streitfeld explains why food costs are rising sharply, noting that the biggest factor is heightened demand, including in the developing world.