Are We Coming to the End of Cheap Food?

Consider the econo-caloric history of the United States, as it progressed from “Emerging Market” to Superpower. According to the Federal Reserve Bank of Dallas, the average American in 1919 had to work two hours and 38 minutes to buy a 3-pound chicken. Nowadays, it takes just 15 minutes.

Eric Fry, The Daily Reckoning

Food is the ultimate regressive tax; the poor spend as much as they can to feed themselves, the rich spend as much as they wish.

According to Addison Wiggen, the change in farm commodity prices in 2010 are eye opening:

  • Corn: Up 63%
  • Wheat: Up 84%
  • Soybeans: Up 24%
  • Sugar: Up 55%

These rising prices are in response to decreasing supplies.

US Department of Agriculture estimated that global grain “carryover stocks” – the amount in the world’s silos and stockpiles when the next harvest begins. In September it was 70 days of consumption. A month earlier, it was 71 days. The month before that, 72. At this rate, come next spring, we’ll be down to just 64 days – the figure reached in 2007 that touched off the food crisis of 2008.

But what happens if the US scenario is worse than a “nonrecord” harvest? What if there’s a Russia-scale crop failure here at home?

Read the details here and here.

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