Food Inflation
17 12 2007We have mentioned food inflation in the past and it keeps coming back. When will it start to accelerate? Or has it? When will we notice it in our pocketbooks? I really don’t know what it is about the government inflation numbers I keep paying higher and higher prices for food and energy, yet inflation just keeps creeping along at a very low number. I wished I could manipulate numbers in the same fashion. Sometimes I wonder if we where all educated in the same system or, maybe this is just New New Math.
Today Wheat on the Chicago Board of Trade is over $10.00 a bushel, an all time high, more that 2.5 times the average price over the past 15 years, soybeans are trading at a 34 year high. Prices seems to be headed higher before lower. There is global tightness in basic commodities.
How will all this food inflation impact the food cost for the imported vegetables we do from China? As we have already mentioned food cost are increasing because of labor cost, energy cost, weather related problems. Now with the basic grains increasing in cost I wonder how many farmers of peapods and waterchestnuts will switch to wheat or corn or some other basic crop. It doesn’t take too much Old Math to figure out you can make more money for a crop selling at $10.00 per bushel vs. $2 or $3 dollar a bushel.
I would suspect that all our imported crops will continue to accelerate in cost which will lead to higher food cost which will exacerbate the inflationary spiral.
Look out for the inflationary monster to raise its ugly head once again.
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