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Get Out Your $#%@# Checkbook! Here Comes "Food Inflation"

meatguy.jpgThink you're paying too much for food now? You're going to pay more in 2008 according to Reuters.

"There's going to be real food inflation in this country," C. Larry Pope, president and chief executive of U.S. beef processor Smithfield Foods Inc., said at the U.S. Agriculture Department's annual outlook conference.

Prices of grain futures have surged lately. For example, wheat futures have more than doubled on the Chicago Board of Trade over the last 12 months. Pope said meat shoppers eventually will pay for the rally because farmers who raise livestock cannot absorb the sharp escalation in feed costs.

Pope said the rip-roaring rallies in corn, soybeans and wheat would be good for farmers, but are "scary" for companies like Smithfield and the rest of the livestock industry.

"I think we need to tell the American consumer that things are going up," he said in a speech. "We're seeing cost increases that we've never seen in our business."

Hasn't someone figured out how to feed the damn cows grass again? Wasn't Michael Pollan in charge of that?

Food industry says prices headed up again in '08 [Reuters]
(Photo:amyadoysie)

4:24 PM on Fri Feb 22 2008
By Meg Marco
6,921 views
73 comments

Comments

  • Think you're paying too much for food now? You're going to pay more in 2008
    Now is 2008 already.

  • Pollan, eh? I'm on the last chapter of Omnivore... I sooooo want to own like 500 acres and be a grass farmer.

  • The price for pizza is going to skyrocket. I work at a pizza shop and we are already preparing to raise the price on pizza. The bakery where we get the sub rolls has already raised the price. Watch out for your neighborhood pizza shop going under quick.

  • Wow that steak has a lot of fat in it, food is going up because of Bio fuels among other things!!!

  • Well, at least in Wyoming, you need to supplement grass with other feed because there is this little thing called "rain" that doesn't happen very often.

  • @savvy999: but what kind of grass? :wink:

  • I seriously wish people would smarten up and look at what biofuels actually are, and the TRUE cost of them. How is it saving the enviroment when you cut down forests and trees to raise crops for fuel. THEN, you have to ship that fuel b/c ethanol can not touch water, or else it becomes tainted, which negates sending it through pipelines. So you have land loss, and then all of the carbon from long haul trucking. But Al Gore says it will help, so I agree.

  • This isn't surprising. You try to take the food in your pantry to power your car and two things will happen: You won't get very far, and you'll have to pay for more food.

  • @smitty1123: That and grass isn't the most nutrient rich food. So you need to supplement to support the herd size on the property size, rain or not.

  • I've been paying inflated food prices here in Hawaii for years. Velveeta for $14 a box? Yeah...exactly.

  • Yes! Increase the shit lagoons!!!
    Might as well save some money by eating clones.

  • They say a big component food prices is fuel/transport costs. With oil over $100, I can see how this will only get worse. I can only imagine what kind of cheap feed they'll give the cattle that we eventually eat. And, I'm sure the FDA will be closely monitoring everything. I thought Iraq, constantly threatening Chavez, providing huge tax breaks for oil companies, ignorning Africa, easing mileage standards, etc. was supposed to bring oil prices down. What happened?

  • You mean the magical hamburger trees aren't working anymore?

  • One thing that I've done to cut my grocery bill is to cut down (not out) on meat. I have it a few days a week, but not everyday (or for some, every meal). Not only is it expensive (and getting worse), but the amount of ressources (grain, water, fuel, etc.) needed to grow and transport it is huge. I'm not cutting it out, so I don't worry about nutrient issues or feel like I'm depriving myself. Yes, you can live without it, but I love a good burger once in a while, just like others. I just don't do it as much, and saves me money and is probably a lot healthier.

  • @ARP: But this applies to all meat. Like chicken and pork and fish. Corn and soybean based feeds are plentiful and work great. But when you divert more and more to biofuels, you increase demand, and the prices go up. What do you think will happen to vegetables when farmers opt to stop with other crops, and goto soybean or corn just for the fuel industry?

  • Can't they just grind up the sick cows and feed them to the healthy ones?

    You might think this is a sick joke, but if livestock feed prices skyrocket, I will bet anyone that agribusiness will be tempted to pull crap like that.

  • The cost of food is going up as a direct result of the increasing national demand for corn, raising its price. More expensive feed for animals means more expensive meat.

  • @Thorny: Your bigger problem is that someone has managed to convince you that Velveeta is food! They raise cattle on the Big Island, surely some if it is for dairy, get yourself some real food.

  • @Git Em SteveDave: I wish they would use all the soy for fuel and get it out of the food supply. My husband is allergic to the stuff and it is so hard these days to find food that doesn't contain soy.

  • @NotATool: Tempted? They already do this quite regularly, though it is now illegal. There are several books about it, including Mad Cowboy and No More Bull. When Howard Lyman, a rancher himself, revealed this truth on television in 1996, the National Cattleman's Beef Association sued him (they lost).

  • Image of johnva johnva at 05:06 PM on 02/22/08 *

    @smitty1123: Then they shouldn't raise cattle in Wyoming. They should raise them where it can be done most efficiently. There is a reason that cattle require much more land in places like Wyoming than in say, Alabama.

  • Image of johnva johnva at 05:08 PM on 02/22/08 *

    @Git Em SteveDave: Vegetables and stuff will go up in price, but not as much as meat. Because it's much more resource-efficient to eat vegetable matter directly than it is to cycle it through animals.

  • The devaluation of the dollar helping this right along, robbing value out of your bank account, sort of an inflation tax that drives up costs on everything. Thank slashed interest rates for this mess much like the housing bubble.

    Also, things like corn are big money now that Agri-business has the side of government to get 'renewable fuel' and 'alternative energy' legislation. Never mind the huge amounts of water this sucks up just to make fuel not food, and the fact that corn based ethanol takes more energy to process than comes out of the process. Thank do-gooders in congress that have no constitutional authority to dictate such things for that part. Let the market work without subsidizing 'green' or subsizing 'oil'

  • Image of johnva johnva at 05:11 PM on 02/22/08 *

    @ARP: Yep, cutting down on meat is the best solution. There is no reason we all need to give it up, but it's an unnecessary luxury to eat it every day or multiple times per day. I suspect that meat will become more and more of an occasional treat than an everyday thing for more and more people in the future. We just can't sustain our current level of meat consumption at cheap prices.

  • @johnva: Efficiency has very little to do with anything humans do.

  • Funny story. Normally I shop at Whole Foods (cooking is the hobby I tend to splurge on). Last week I went to a regular grocery store, got the usual suspects, and for the first time it was just as expensive to go conventional!

  • Dude, +1 for the Michael Pollan reference!

    I've noticed RIDICULOUS increases in my last couple bills. I'd been noticing things creeping up, but suddenly dairy products are absolutely ABSURD. As are nuts, incidentally (picked some up for a pecan cookie my husband likes). My grocery bills are just out of control suddenly.

    Even very basic things, like flour and sugar, have gone up 10 or 20 cents.

    On the somewhat plus side, I'm on a local agricultural board, and we're seeing a lot of interest in buying local meat direct from local farmers, who are typically organic and/or traditional if they're selling direct-to-consumer. Their prices are getting more and more competitive with supermarket prices since they, you know, feed the cows grass, not corn. But still. Dairy products are absurd and while I can live without meat, I need my dairy, and this is just ridiculous.

  • An interesting take on the idea of a farm. [www.ted.com]

  • NotATool: I don't think cows are omnivores and can digest meat like they do grass and feed. Also, feeding healthy cows sick cow bits will likely cause the healthy cow to become sick, which is bad. There's a reason downer cows are not allowed into the food supply.

  • Image of johnva johnva at 05:27 PM on 02/22/08 *

    @HRHKingFriday: Yep, I think it's been moving this way for some time. The price difference has gotten to be so small that I don't see much point in bothering with a separate trip to a "conventional" grocery much anymore. We usually shop at Whole Foods because we don't mind paying for high quality food.

  • @Git Em SteveDave:
    They're planning two ethanol pipelines here in Iowa. I guess someone should let them know they can't do it.


  • Not only is this because of Al Gore and all his "green" hippy friends wanting people to use biofuel made from of course corn, but its also rising because they also like to pay people to NOT plant stuff on their land (also under the guise of "green" land preservation) This also raises prices because there are less places to plant. Environmentalism will be the downfall of this country yet!!!

  • @Gorky: Ford totally had the right idea in the 50s: [en.wikipedia.org]

  • I work at a grocery store and EVERYTHING has gone up. White bread (yuck) that was 79 cents a few months ago is now 99 cents (and is probably being sold at a huge loss just to get people in to buy other stuff). Eggs that were 99 cents are now well over $2 dollars. Milk is insane, but I only like it in cereal, so that hasn't effected me much. And if the prices haven't gone up, the quantity has shrunk dramatically. Luckily, i'm still able to keep my weekly grocery bill (including household and health items) very low by shopping 3 different stores and BJ'S (Wholesale Club) and using piles of coupons.

  • @eyebleave:

    You dont find that much soy in food products if you stay away from the "organic" section of the store where you cant find ANYTHING that isnt either fake meat, whole grain, or soy. You cant even get any WHITE organic bread or pizza crusts. They must think all people who buy organic want to eat super healthy

  • I'm so glad we're still paying farm subsidies.

  • With so many hungry people in the world, it just seems creepy to grow crops to use as fuel in our cars.

  • Image of johnva johnva at 05:43 PM on 02/22/08 *

    @Gorky: Assuming that "all people who buy organic want to eat super healthy" may be a pretty good assumption on the stores' part. Those would tend to be people who pay attention to what they eat, at least a little bit, by definition. So it's probable that healthier foods sell better in the organic section.

    Also, I see organic white bread for sale all the time. But you're right that there is less selection in organic convenience foods.

  • @Git Em SteveDave: But if we can chop down more forests and replace them with grasslands, it will help to remove more carbon from the atmosphere. Old-Growth forests are very inefficient since they grow so slowly. Al Gore is right that we need to clear-cut and replant with fast-growing grass.

  • It will be interesting to see how many of the states that currently exempt sales and use tax on groceries will rethink their taxing policies with the rising cost of food just as some states did when gas prices started to skyrocket (changed from cents per gallon to percentage per gallon).

    California is currently driving towards a 20 billion dollar deficit this year and it does not charge sales tax on groceries unlike neighboring states. Not that I want to give anyone any ideas I'm sure they'll stumble onto to that idea on their own soon enough.

  • @RoughSpin: Oh my God!!! No, not the pizza, I need that!

  • @NotATool: "Can't they just grind up the sick cows and feed them to the healthy ones?"

    No, because the FDA specifically prohibits feeding ruminant derived feed to ruminants, due the the scare of spreading prion-based diseases (bovine spongiform encephalopathy) from one cow to another.

    They did this in England, feeding sheep-based feed to cows, and it is believed that this is how BSE originated, by jumping species from the more common sheep version.

    However, you can give ruminant derived feed to poultry, and poultry based feed to ruminants, so really, you just need to cycle it through another animal first!

    The moral of the story here is to buy beef that is vegetarian fed.

  • It'd be nice if they'd quote a percentage. If it goes up 5%, then no big deal. Then again, 20% is a big friggin' deal.

  • 2 weeks ago I noticed the frozen Barilla meals (which normally are around 7 bucks, or around 5 with a coupon) were going for $8.99. 9 dollars for some crappy frozen pasta. This is in NC, by the way.

  • I've definitely seen prices go up. My grocery bills are insane these days, and I really try not to buy much meat. Living off of veggies is how I've been trying to roll, but I still need some meat every other day or so. Hopefully I can cut some costs by planting this spring, otherwise I'm eyeing that dirt patch near my patio....

  • well i guess they can just stop giving farmers subsidies to not farm and let them farm so we can lower prices.

  • @johnva: Supermarkets around here are already getting stuck with loads of meat that they can't sell for the prices they want (have to mark it down to get rid of it). I don't see the logic in jacking prices up even further if people already aren't buying.

  • "We're gonna' finance anybody! Talk to my son Timothy in the finance department!

    Fuck you, son!"

  • they should just recycle dead people into bars to feed the healthy humans.