ss_blog_claim=8dcabb3175f064b32823a45ed345083b Majik's Thoughts: Inflation on Food Prices

4/13/2008

Inflation on Food Prices

While I was doing my usual surf through a few news network websites I came across this article about inflation and food. In the article a report by the U.N. is mentioned as well as the Food and Agriculture Organization. The report was released last Friday and states that the cost of wheat and rice produce has doubled in the past year. The demand for cereals has been much stronger in the past two months which inevitably increases the price. They are also saying that this is not any short-term problem but one for the long-term.

People are not going to stand for higher food costs. Right now some people have trouble keeping food on the table in today's changing market. The higher cost of food has sparked riots in Africa and the Philippines. We could see more riots and protests over higher prices on food in the coming months, maybe even years. What kind of effect will that have on the price? They may reduce prices by a fraction of a percent or more; but the truth be told, we will have to wait and see if it makes a difference.

What does higher costs for rice and wheat have to do with Canadians? Well some of the farmers in Alberta, Manitoba and Saskatchewan will benefit from being able to sell their grains ate higher prices. The rest of us Canadians on the other side of the chain will have to pay even more on our grocery bills. Considering that there are still a large number of Canadians that are not able to afford both shelter and food; this is not good news. I have noticed a rise in the cost of a loaf of bread, until the supply can meet the demand I fear even more price increases are imminent. That's my opinion; what do you think about it?

Image source: Wiki Media Commons
News article: Food prices to surge higher, UN report warns

3 comments:

Alexis said...

Actually, the problem is much more complicated. The housing problem has nothing to do with houses. It has to do with people who cannot pay for their home. This means, for instance, people who all of a sudden need more money to pay for their food and cannot afford their mortgage anymore. Really frankly, the housing problem has nothing to do with houses and mortgage themselves. It has much more to do with all of the other factors. Many people got a mortgage without a job, or with a really precarious job. The result in the end is they lose their home. And frankly, if you have a choice between eating or having a house...

This being said, the cost of gas has a bit more than doubled in the last few years and it is still going up.

It could be that this will help greatly in getting us to use corn to create gas. Even though a lot of people are saying it cost nearly as much energy to generate the gas... (At least today).

If you would want to write a really good article about this, you should include all that information.

Alexis W.
http://www.m2osw.com

Majik2903 said...

Alexis,

Thanks for stopping by and offering your critique. I was purposely leaving some information out about the cost of gas affecting food costs considering I was talking about just the supply and demand of wheat and rice. As for the housing issue, I only mentioned it to prove my point that a rise in the cost of food is bad. As both of the factors that you included, they are for another post as their affect on supply and demand are minimal. But thanks for you invaluable input on the housing and rising gas situation.

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