Morningstar Analyst - All Food Up 4%, Milk Up 10%, Eggs Up 30%, Thanks To Corn/Biofuels Effects

[hatrack]

EDIT

With the cost of staples such as eggs (up nearly 30 percent in the past year), milk and bread escalating, some consumers say they are adjusting their spending habits.

Susan McCranie said she can no longer afford to splurge on ice cream and other types of "junk food" to stay within her biweekly $125 grocery budget for two. The Winter Garden resident said she has become more of bargain hunter, scanning grocers' circulars for two-for-one specials and other deals. "You have to watch your pennies," said McCranie, 61, after a shopping trip at a Publix on South Orange Avenue in Orlando.

So what's causing the jumping prices? Corn. Ethanol producers have driven up demand for the grain, which is used to make ethanol blends. That has caused the cost of a bushel of corn to nearly double since spring of last year.

That price jump has led to rising costs for other foods and meats, because corn is an essential part of the U.S. food-supply chain. Farmers use the grain to feed dairy cattle, poultry and other livestock.

EDIT

On edit: Sorry! Totally forgot the link!

http://www.orlandosentinel.com/business/orl-foodprice1407jul14,0,7778150.story

[LaurenG]

1. If it goes to the farmers so be it but since the majority probably goes to monsanto et al

I can only say, that figures.

One day Americans will have had enough with corporations and the corporate whores who serve them.

[kestrel91316]

23. I get my produce and eggs and honey at the farmer's market. It may

cost the same, or in some cases way more than at the grocery store, but at least the money goes to THE FARMERS. I especially like that my eggs and honey are produced less than ten miles from my house. No small feat in Los Angeles......

[SaveAmerica]

2. Is there a link to that so we can see if they mention high gas prices

being paid for by increasing prices of products?

[Exultant Democracy]

3. Not just corn, gas prices too. The easy quick solution is for everyone to reduce

their meat consumption. Saves energy and frees of a lot of land for more sustainable and practical use then clogging our nations arteries.

[HereSince1628]

8. ?? The QUICK solution is to quit running your internal combustion engines

as much as possible.

Drop in fuel demand would impact fuel prices in a matter of weeks. Meats on average take many months after animal birth to reach the market. Even vegetable oils & cellulose have longer consumer-producer transient times than the demand/cost feedback for internal combustion engine fuels.

[kestrel91316]

11. I'm riding my bike the three miles to work four times a week now.

Every little bit helps.

That said, I get really angry to see the giant SUVs racing up and down the streets morning, noon, and night like there's no price pressure at all on gas.....

[HereSince1628]

13. For them there might not be. Disposable income is very relative.

They might also be "trapped" by a series of bad decisions--poor vehicle choice, poor choice of where to live relative to distance to work and shopping, etc. You know that if you buy a really big gas guzzler it's gets treated specially for taxes because no one in their right mind would buy one otherwise. So there are also "advantages" to buying a Hummer.

But, please, don't feel bad. Your not buying fuel is in itself a $aving$ that is directly yours, and each drop less in demand helps lower the price for everyone, your indirect contribution to lower future costs to yourself.

Me, I keep my 10 year-old Ford Escort wagon putting down the road at about 30 mpg when I can't get 'there' in reasonable time and safety under my own power. Bike riding in the US is freaking dangerous in most business districts.

[Exultant Democracy]

12. I said quick and easy, since the fule demand continues to rise

even with the current high costs, we know kicking our oil kick won't be easy.

"Drop in fuel demand would impact fuel prices in a matter of weeks. Meats on average take many months after animal birth to reach the market. Even vegetable oils & cellulose have longer consumer-producer transient times than the demand/cost feedback for internal combustion engine fuels."

Well the OP was about food prices and that is what I was talking about not fuel prices.

[HereSince1628]

19. Meat production cycle is much longer than the crop-production cycle

And consequently the feedback loop for meats is not the quickest way to impact retail prices of food or fuel.

Meat/dairy cattle have a productive life of 3-6 years. Once a farmer bets on that by buying a herd he/she is committed to that sort of timeframe for return on investment. One way or another losses get carried over onto the cost of future production. Crop production in temperate zones of the US is by and large annual, decisions mid-year can't impact crop availability for as much as a year and one-half.

Fuel demand to price feedbacks are much much shorter that livestock production cycles. If you want a "quick" impact on food costs you've got to attack food costs at the point that yields the quickest change in price. Fuel demand has a much shorter time-delay than meat, milk, corn or soybean production has and so reducing fuel costs reduces energy costs which can, and do, show up rather quickly in prices of products on grocery store shelves.

On a somewhat more theoretical level, I doubt that diverting resources at the lower level of energy pyramids to "feed" internal combustion engines can ever have a good result with respect to maintaining abundance of species within those systems. Although we talk about terrestrial systems as detrital food chains we seldom consider the detritus as a "valuable" resource for something other than our own. We prefer to think of detritus as unused "surplus." Consequently, self-centered decision making about our energy supplements cuts terrestrial ecosytems at both the ankle level of dtritovores and also at the neck in terms of energy and nutrients allowed to reach higher levels.

I suspect that biofuels enable internal combustion engine dependent thinking that facilitates energy and nutrient diversion that simply said, eliminates resources needed to maintain co-habiting species.

[rodeodance]

4. UW-Madison just got a huge grant to do research on NON-edible plants-the

present technology to convert plants such as switchgrass, corn stalks is just not 'there' yet---the efficiency factor.

[glowing]

6. just use hemp.

[Exultant Democracy]

14. They would still have to use space to grow the crop

space that could be used for human food. Even when they talk about using corn stalk they are referring to the corn that goes to animal feed first (very inefficient) before it goes to feed humans.

[Lasher]

5. Putting the pinch on food budgets to keep those Hummers on the road.

Might as well. Only the rich people have money to buy things with anyway.

[glowing]

7. Does that mean that organic food and modified who knows what

are the same price now?

[yardwork]

9. What about the cost of gasoline, which powers everything?

No mention of the incredibly increased cost of gas and oil to run the machines that harvest, process, and transport the food?

This is part of the "environmentalists are at fault" meme.

If it isn't Bill Clinton's penis, it's those vicious environmentalists causing all our problems! /sarcasm

[razzleberry]

10. lies, corn has not doubled

latest price for corn, end of business Friday, 3.69 / bu

IIRC, price was never less than 2.40

[4dsc]

15. not that long ago

corn at $1.835 on January 21 2005,

[razzleberry]

18. what is a reasonable price? .

people bitch about subsidies.
your thoughts are?

[4dsc]

16. Cost of everything is going up

Its due to many factors including corn and oil!! But its amazing that someone is actually reporting this to the stupid consumer!!

[philb]

26. Are you suggesting inflation is higher in general than Gov't tells us?

[beyurslf]

17. $4 for a gallon of milk last week at the store. I about died.

[kestrel91316]

24. Here in Los Angeles we pay $4 a HALF gallon if we want

organic milk from pasture-grazed cows. I almost won't drink anything else. I would buy the raw milk we can get at Whole Foods but it's just TOO expensive.

[Odin2005]

20. Quit stuffing HFCS in our food, problem solved.

That was easy...

[Delphinus]

21. I tell you, finding products WITHOUT

HFCS is a job in itself!

[kestrel91316]

25. Don't buy food "products". Buy REAL FOOD:

http://www.ninaplanck.com/index.php?page=real_food_book

Buy fresh fruits and veggies from your farmer's market and prepare them yourself. If you can't or won't bake your own bread, buy from a local baker. Pasture-raised eggs, poultry, pork, chicken. Grass-fed beef. Eat less, but eat better. Butter, not margarine. Lard, not shortening. Olive oil, not corn oil.

[Delphinus]

27. Hi kestrel91316.

That's what I'm doing - certain things like mustard, ketchup, things I don't even know how to make, are what I'm talking about.

I've never made bread, but I'm going to a class this week (talk about synchronicity!) and I can add that to my repertoire. :)

[kestrel91316]

29. Bread is fun and easy and a big money saver, and homemade is SO much better.

Homemade mustard is easy. Web recipes abound. Homemade ketchup is also easy, but can be time-consuming. Taste makes it well worth it.

[XemaSab]

22. Morningstar is putting in a BUNCH of solar

:bounce:

[losthills]

28. The great swindle of "Bio-fuels..."

Ethanol is a fraud and a boondoggle.

It takes more oil to make a gallon of ethanol than it does to make a gallon of gasoline since our whole agri-business industry is totally dependent on petroleum based fertilizers, insecticides and herbicides, and it takes more oil (or coal) to refine it.

If we allow this charade to continue it will cause the price of to increase as the price of oil goes up. And it will lead, inevitably to food shortages and deforestation.

Besides being a huge corporate wellfare program it's a smokescreen to justify our continued acceptance of the internal combustion engine as our primary means of transportation.

If we are serious about addressing global warming we have to begin phasing out the internal combustion engine now. So-called "Biofuels" are a last ditch attempt by the oil companies and Automakers to cling to their asphalt empire...