Time to start putting the veggie patch to good use

[Gob]

With global food prices at record highs, a supermarket war isn't enough to keep prices down.

Why food prices are rising

■It's about supply and demand, and recent weather issues around the globe have affected supply.

■But there is also a bigger underlying reason - food demand is growing because of high population and income growth in developing countries.

■This, in turn, is supporting demand for grains and increasingly for protein sources such as meat and dairy.

■Growing demand for agricultural inputs for biofuels is also a factor.

■On the supply side, the agricultural productivity gains experienced in the 1960s to 1980s have waned, and in many developing economies agriculture remains very labour intensive

While food price inflation is still to emerge as a big issue in Australia, rising food prices are a major problem across many parts of the world right now.

Food price inflation is said to be a big factor behind the civil turmoil in the Middle East and North Africa that has led to leaders in Egypt and Tunisia being dumped. In Uganda it was behind an almost doubling in inflation to an annual 11.1 per cent in March.

In Europe, rising food prices are cited as one of the main reasons why the European Central Bank may lift interest rates at its meeting this week despite growing debt problems among the PIIGS (Portugal, Italy, Ireland, Greece and Spain).

Countries such as Algeria and Saudi Arabia have been stockpiling wheat and Bangladesh and Indonesia rice to enable them to contain panic buying, inflation and social unrest, while Russia and Ukraine have introduced grain export restrictions. In India, food price inflation is running at an annual 15 per cent and the price of onions has doubled in a year, while Pakistan has stopped some exports of onions to India in a bid to tame its own onion prices.

The rising cost of food is a huge problem in China, helping push annual inflation to 4.9 per cent in February as workers move from rural areas to the cities and lift their living standards and basic food consumption (particularly protein).

According to the Reserve Bank's March Bulletin Developments in Global Food Prices, China's calorie intake per person has doubled in 40 years and has now passed that of Japan and is closing in on that of Europe and the US.


Over the past two years, the global price of food has surged 50 per cent to an all-time high, as measured by the IMF's food price index.

As a major food producing country and a net exporter of food, there are two sides to record food global prices for our economy, says RBS Morgans partner Simon Bond. He says it's a positive for the country as a whole and great news for our rural food producers - it was one of the main reasons for the jump in agricultural sector confidence last week.



The increased use of biofuels around the world, which require sugar cane, vegetable oils and corn to produce, are also an issue, according to the central bank. ''Consistent with this, almost 40 per cent of US corn production is estimated to be used in ethanol production in 2010-11.''


http://www.smh.com.au/business/going-up ... 1csgs.html

[The Hen]

After you my love. You can dig, I'll plant and tend.

[Andrew D]

But there is also a bigger underlying reason - food demand is growing because of high population and income growth in developing countries.

Which is the principal cause of a great many of the world's problems. If we don't get rampant overbreeding under control, things will only get worse. Faster and faster and faster ....

[oldr_n_wsr]

I planted corn this year (only 'cause I already had the pack of seeds).