Saturday, March 12, 2011

Grain by numbers: why the price of food is unlikely to fall

Lester Brown crunches the numbers and argues that it is unlikely that food prices will significantly fall from their record highs this year. And the long term outlook is worse, though not without glimmers of hope.

This is at the heart of the various crises facing us in the coming decades, since food prices are linked to political stability in many countries. And one country's political instability is a neighbouring country's diplomatic, economic and/or refugee crisis.

Lent is as good a time as any to reflect on our patterns of food consumption. Where does our food come from? What is its footprint? Are we, through our diet and purchasing choices, eating more than our fair share?


Donna said...

I just bought 2 and a half kilos of potatoes for 10 rupees (25 cents). But you're right, it used to be 8 rupees.

Mike W said...

There was an interesting interview with Fred Kaufman from Harpers magazine on ABC Radio last night.
He argues that the problem isn't simply lack of supply, but also large banks investing in food futures. When all the other shaky investments fell down, banks pumped their money into commodities, in this case, deregulated food derivatives. It drives the price up because the banks have no stake in the market, they are not farmers nor consumers, just playing the game.
Interesting theory, and it is always nice to blame speculative investors

byron smith said...

Yep, the relative weight of that effect and of actual shortages is difficult to know and I've read conflicting accounts that blame one or the other or both. I mentioned the various likely causes here, including speculation (and hoarding from other governments worried about instability due to high prices).