Posted on 08/31/2010 11:49:11 AM PDT by blam
Food Crisis Doomsday Scenario As Prices To Shoot Through The Roof
Politics / Food Crisis
Aug 31, 2010 - 08:52 AM
By: Pravda
The worst weather on record coupled with the practice of speculation in the commodities markets are set to send food prices skyrocketing, bringing misery and starvation to large swathes of the world’s population. Are we set to see food riots this winter?
In the USA, Walmart has already announced a price hike of 5.8% on average for a 31-item basic basket for this Autumn. The long-term rise, however, is far more frightening, with the UNO predicting an increase of 60 per cent by 2030.
What is happening?
When there is a massive price spike, such as the case in recent years, followed by more price rises (as is the case today) the markets panic and speculative buying sends the prices through the roof. The market economy system is indeed not all about supply and demand but is also, and fundamentally, fuelled by speculative trading, with spot buyers buying future positions of commodities. When they are scarce, and the more so when the market senses that a scarcity exists, the price goes up.
This is what is happening today. September corn is up by 3.6% a bushel, wheat by 34 cents. In July the price of wheat shot up by the highest quantity in the last 50 years: 42 per cent. This in turn will push up prices of pasta, bread and cereals in the near future.
Prices set to rise for 12 to 18 months
Analysts predict upward trends in wheat, corn, soybeans, bean oil and bean meal and the general feeling is a continued rising trend over the next 12 to 18 months. As usual, no mechanisms have been activated to protect the world’s poorer populations from the dramatic effects of supply issues and the resulting speculation in prices.
Global production downturn
Russia reports a drop in production of around 20 per cent due to dry weather conditions. Drought has also affected Ukraine (where maximum production is set to reach just 66% of domestic demand) and Kazakhstan, while floods have affected 13 million acres of cereals in Canada and have wiped out a large part of China’s harvest. Germany’s wheat production is ten to twenty per cent down on 2009; in Argentina dry conditions mean that only 80% of the arable land for cereals has been planted.
The S word: Speculation
In today’s market economy system, what drives the prices is not only supply and demand but also the S word: Speculation, where a handful of players push prices sky high and way beyond the reaches of the pockets of the average consumer. If the system were based upon supply and demand then the price of soybean would be bearish (top-down attack, falling), because the main producers (Brazil, Argentina and the USA), have had a good harvest. Then why is the price of soybean bullish (bottom-up attack, rising)?
Because cash premiums are forcing the soybean futures rates higher as a process of over-consumption of soybean is noticed in the marketplace (soybean is present these days in most foodstuffs and other consumable items). So much so, that the price of soybean would have to rise a further 50 to 80% to curb the current demand.
And it makes sense for this to happen…and that is going to affect the price of everything we eat.
Couple this with the rising cost of transportation (crude and natural gas prices are set to rise from September) and we see our comfortable little monetarist-oriented market economy system has engendered another fine crisis looming on the horizon. Watch this space.
Vast swathes of the planet are set to go hungry. Those who were previously hungry may starve. It is the Doomsday Scenario and it is upon us. And it is caused not by the lack of supply or scarcity of abundance. It is caused by this manic, inhumane system, the S-word, Speculation.
With all the obesity in the USA, a food crisis might be the best thing for people’s health here.
“Vast swathes of the planet are set to go hungry. Those who were previously hungry may starve”
...with our resources we don’t need to play any role in this. We will, but don’t need to.
Naw the S word is Socialism and Speculators know what that causes
TT
Another crisis?
My crisis sensors were saturated long ago.
Ah! Pravda!
Accurate I’m sure.
OMG! ONOZ! We’re dooomed. Doomed I tell you. I’m spending all my money on canned spam.
The Jewell store we shop at lifted alot of their prices by a sizable amount this past month.
Food prices, including fast food, seem really high.
I must be a cynic as I was waiting until the end to see a “buy gold now!” incantation.
I’m bearish on the doomsday scenario.
Or if you believe in divine providence you could say that people were prepared for the inevitable obama famine.
Maybe your dollars are just really weak.
Has Walmart ever preannounced price increases, especially a long time in advance? That sets off my BS detector for the who article.
Normally you just go into a store and see price were higher than the last time you went in. Sometimes they try to sneak in a big price increase like when a bag of chips goes from $3 to $4. They'll put up the new $4 sign, but say $1.11 off/now only $2.89.
My dollars are the size of a postage stamp, like in that gold commercial, lol.
Send in the tanks. Crush the speculators and profiteers!
Just dropped 350.00 at Sam’s Club.
Lots of coffee and peanut butter.
Between the rice I bought before, the stuff I bought today and the produce I’ve been processing we’ll make it through pretty well.
chances are good that the politically connected with legislative control of present grain resources will profit tidily in this current round. our next generation of leaders.
most in the west will pay whatever the cost for their beers, and the darkskinned brethren they profess compassion for will eat dirt and die in grizzly fashion.
Isn’t this the third horse of the Apocalypse? A black horse as I recall.
Kruschev credited it with keeping him alive. Pity, that.
“...frightening, with the UNO predicting an increase of 60 per cent by 2030”
A 60% increase over 20 yrs is “frightening”?
Gee, no mention of the central valley in California where huge swaths of farm land are sitting fallow because of the obamanation’s water restriction (to save some fish). Wonder why? /sarc
Have you actually looked at the size of the package you are getting? Many products have been downsized without lowering the price.
I think Kruschev was drunk when he said that. Well... must have been, most of the time, anyway.
Yep - 2.5% per year, compounded.
DOOMED! DOOMED, I tell you!
I’m having guests this evening, so last night I did a quick, late shopping. I went to Walmart and to another local grocery store.
Many prices were up with the quantities down. Bacon was a sticker shock, about a 30% increase. At the start of the season, red peppers were nearly double what they were last winter! Dairy products, especially butter, cream cheese and cream, were high, as they have been for weeks. Meanwhile, my farmer friends and neighbors are barely receiving enough for their milk to continue in business, insuring a further drop in producers. Bread and grain products in general seemed unchanged. House brand paper products were about the same, as well.
So, today, I looked at commodity futures. All grains down several cents. Beef about the same, with pork, especially bellies, still high.
But, locally, our row crops look wonderful, the weather has been excellent and I know that pigs are prolific, farmers are opportunistic and I see that the commodity pork prices have slipped for later in the year. Many producers I know have switched to pigs for this year.
We are sort of a captive market here in my rural area. My husband tends to graze prices on various items at least once a week when he goes to work in a larger city and so, we tend to stay on an even keel, over time. But my little dinner party tonight set me back more than I expected. Add in some OTC items we both needed for minor issues and the total bill was quite high, considering.
The Soviet Army survived the 2nd half of WW2 on Spam and they still have a warm spot in their hearts for Spam. I think many of those convoys to Murmansk held many tons of Spam.
Stop burning our food in cars and there won’t be a food crisis.
I’m spending all my money on canned spam.
For only $19.95 I will send you my recipe booklet on 101 Ways To Cook Spam And Like It - heck, I may as well profit on this crisis. I missed most of them;)
I pretty much buy the same things every other week. Several packages are same size but less contents. Groceries this last week were 8% more than two weeks ago and not as many twofers. One store has now started doing a significant price reduction only if you buy 4 or 5 of the same thing.
Krogers went down in the study by a percent, Safeway went up.
Interesting to note that some of our local dairies are bringing back the actual half gallon of ice cream, and selling it for the same price as before, bucking the trend of making 3 pint or smaller containers.
Has Walmart ever preannounced price increases, especially a long time in advance? That sets off my BS detector for the who article.
I gonna worry when they start selling their products for gold coins. Anyway, I have got enough on my plate trying to service the leftist congress and part time president. Oh, by the way, is he back from vacation yet?
That's old. I remember when I was a kid back in the 70s and early 80s reading a journal examining the quirks and foibles of modern society (OK, I admit it, I was reading Mad Magazine) and that has been going on for a long, long time. One piece in an old back issue made fun of the shrinking 5¢ (yes, 5¢) candy bar.
I've been eating a lot more fresh fruits, vegetables and unprocessed meats recently so it is harder to sneak price increases past me because everything is priced per pound.
WE ARE ALL GONNA DIE AND THE GULF WILL BE A WASTELAND FOREVER AND THERE’S GONNA BE AN ICE AGE! DOGS AND CATS LIVING TOGETER!
My son and I visited Wendy's last night. It was the first time I had been in a fast food joint in years. Two sandwich meals (chicken + dbl burger w/fries & drinks) = $17.06
I though there was a math error somewhere but I added the prices up as we ate and came up with the same numbers. Cripes!
ping
Except for the fact that the fattest people in the US get their food free, paid for by welfare. Food prices go up and you get to pay extra for their free food.
I notice one of our two grocery stores here has started offering a good price on items only if you buy ten of whatever it is.
That's some food for thought.
LOL
Just what the unemployed were looking for high food prices. Expect to see in rise in food stamps use by illegals and Obama sueing states that try to cut them off.
guess this guy was right : Jim Rogers/Asian Financial Forum (World Commodities fundamentals enhanced), January 24, 2009
Most people don't even know where to look for that price though. It is on a tag of the shelf the product is on. Takes all the guess work and figuring the lower priced product.
“Food prices, including fast food, seem really high.”
I’m actually amazed that you can get a McChicken, or a McDouble, or similar hot sandwiches or hot foods for a dollar. It absolutely blows my mind.
Then again I am also impressed that I can send a letter anywhere in the U.S. for 44 cents. That is incredible to me.
1) H1N1 killed off most would-be starvation victims during the last panic attack.
2) In a pinch, Muslims are a great source of protein.
3) Obesity and famine are never found in the same populace.
4) Oil and wine are forecast to be available right up until the Rapture, possibly longer.
5) Somebody, somewhere will be forced to eat Rosie O'Donnel.
6) Richard Simmons will finally have no reason to sweat to anything.
7) The George Foreman Grill in your closet will become a sought-after fat collector.
8) Zombie movies will become an enjoyable fantasy escape from the daily drudgery of scavenging food among the mindless cannibal hordes roaming around outside.
9) Nobody's wife will look fat in anything.
10) Michelle Obama will have no new proposals involving federalizing your children.
For larger families that may be good but on other things if I buy 10, that takes a chunk of the budget and limits the variety of one’s meals. I find that I’m spending roughly the same amount of money now on food for just myself as I spent when I had 2 always hungry teenagers, packed lunches and rarely went out to eat. Tried to get my neighbor’s to form a small co-op purchase program with no luck thus far.
I’m spending all my money on canned spam.
**********************************************
You used to (12 to 18 months ago..) be able to buy the Hormel version of SPAM in the dollar store ,, now it’s $1.79 at the cheapest place I know and genuine SPAM is $2.39 or higher ... buying SPAM may be the investment of choice in 2011.
Yes- buying ten of anything at a time is good for someone with alot of family still home, not so good for any one else. Which is the whole idea- they can say but we have great sales, knowing most people are not going to do that buying.
My response to that almost guaranteed is not to buy whatever it is, period. The price cut is always substantial so that means unless it is something I really need (not going to happen) I just walk right on past.
I would do a co-op with someone if I had the option but I don’t have. I do garden and put up food.
We are going to need to know how to be conservative with buying, and certainly people in general are going to have to learn to live within their means (under their means, actually) or they are going to be in a world of hurt.
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