Results 1 to 12 of 12

Thread: and you thought that food shortages were paranoid delusions ...

  1. #1
    Banned Melonie's Avatar
    Joined
    Jul 2002
    Location
    way south of the border
    Posts
    25,932
    Thanks
    612
    Thanked 10,563 Times in 4,646 Posts
    Blog Entries
    3
    My Mood
    Cynical

    Default and you thought that food shortages were paranoid delusions ...

    (snip)"April 24 (Bloomberg) -- Rice advanced above $25 for the first time as Wal-Mart Stores Inc.'s Sam's Club warehouse unit restricted purchases of some types of rice in the U.S.

    The cereal, the staple food for half the world, has more than doubled in the past year as China, Vietnam and India curbed exports to safeguard domestic supplies. Sam's Club limited buying of jasmine, basmati and long-grain white rice to four bags a visit immediately in all U.S. stores where allowed by law, company spokeswoman Kristy Reed said by e-mail.

    Consumers have started hoarding rice as supplies shrink. Thailand, which ships one third of the world's exports, may restrict sales, a World Bank official said this week. Wheat, corn and soybeans gained to records this year, spurring social unrest in countries including Haiti and Egypt.

    ''We have been neglecting our basic rice production infrastructure and research and development for 15 years,'' said Robert Zeigler, director-general of the International Rice Research Institute in the Philippines. ''National hoarding really doesn't help the market,'' he told Bloomberg Television.

    Rice rose as much as 0.9 percent to $25.01 per 100 pounds in Chicago today and has climbed 26 percent this month.

    The U.S. warehouse clubs are trying to protect business customers, like smaller restaurants, caterers, nursing homes and day-care centers, said Jim Degen, principal of J.M. Degen & Co., a food industry advisory firm based in Templeton, California."(snip)

  2. #2
    Banned Melonie's Avatar
    Joined
    Jul 2002
    Location
    way south of the border
    Posts
    25,932
    Thanks
    612
    Thanked 10,563 Times in 4,646 Posts
    Blog Entries
    3
    My Mood
    Cynical

    Default Re: and you thought that food shortages were paranoid delusions ...

    similar situation at Costco ...

    (snip)"On Wednesday, Sam's Club said customers would no longer be allowed to purchase more than four bags of jasmine, basmati or long-grain white rice on each visit.

    Sam's Club blamed the restriction on "supply and demand trends" and said it was working with suppliers "to ensure we are in stock."

    The policy involves only bags weighing 20 pounds or more and does not affect smaller packages sold at the store or its sister Wal-Mart outlets.

    This week, Costco said it had seen sales of flour, rice and some cooking oils leap. Some Costco stores already have held customers to just two bags of rice a day, but the chain doesn't plan to limit sales nationwide.

    By midafternoon Wednesday, the Costco in Alhambra -- which had not placed limits on purchases -- said it had run out of rice.

    Earlier in the day, Michael Yang, manager of Hawaiian barbecue restaurants in Pico Rivera and West Covina, had decided it was time to stock up. He bought 46 bags of medium-grain rice, 50 pounds each, at the Alhambra Costco and loaded them into his white van.

    He paid $15.39 each, which he called a bargain compared with premium brands from Thailand that have recently nearly doubled in price to $40 for a 50-pound bag.

    "The price of everything -- oil, sugar -- has been going up for months, and rice has been an issue for a few weeks already. Everyone else is doing the same thing I am because they use up their rice so fast," Yang said in Mandarin.

    Prices for many foods, including beer, bread, coffee, pizza and rice, are rising rapidly as the nation contends with its worst bout of food inflation since 1990. "(snip)

    (snip)"Retail experts said there was little evidence of "panic" hoarding by the public. It appears that restaurants and smaller retailers have been buying up most of the stock on the expectation that prices will continue to rise.

    Still, shoppers' actions have taken some stores by surprise.

    "It is like a run on the bank. We don't think there is a shortage, it is just increased shopping by customers who think there is," said Richard Galanti, Costco's chief financial officer. For now, the retailer is allowing managers of stores with short supplies to set their own rules.

    Other retailers report adequate supplies.

    "Ralphs has plenty of rice. No shortages at any of our stores," said Terry O'Neil, spokesman for Ralphs Grocery Co.

    When Heidi Diep visited the Costco in Alhambra last week seeking rice for her Chinese fast-food restaurant in Silver Lake, the store was out of stock. It had plenty of rice when Diep went back Wednesday, but, thanks to shoppers like Diep and Yang, ran out again.

    "I picked up as much as I could," Diep said as she hauled a dozen 50-pound bags of Super Lucky Elephant rice and 10 bags of 25-pound long grain into her van and her sister's sedan.

    The businesswoman said she was stockpiling the grain to avoid future price increases and a repeat of the week when it couldn't be found.

    Internationally, shortages of basic commodities -- including rice, wheat and some oils -- have led to protests and riots in recent months, prompting concern about food security in many poor countries."(snip)

    from


    I basically came away from these news articles with two points etched into my brain. #1 is that America isn't going to face an actual shortage of rice ... only a shortage of formerly cheap imported rice. There is and will continue to be plenty of US grown rice to meet total US rice demand, but the break-even price for that US grown rice will be far higher than past prices for imported rice from China / Vietnam etc. This issue of a developing 'two tier' food supply system, with two different pricing and quality levels, has been discussed in other threads. However, if supplies of 'lower tier' food are limited, then low income people face a choice of buying 1/2 as much 'upper tier' food for the same price. or going hungry.

    #2 is that there is a tremendous amount of 'wholesale' price inflation that has already hit businesses ... in this case restaurants and food processors ... that they have NOT been able to pass along to their retail customers in the form of price increases. This must translate into either a lot of future bankrupt businesses, or a lot of higher retail prices (or some combination of both).

    ~
    Last edited by Melonie; 04-24-2008 at 03:37 AM.

  3. #3
    Banned Melonie's Avatar
    Joined
    Jul 2002
    Location
    way south of the border
    Posts
    25,932
    Thanks
    612
    Thanked 10,563 Times in 4,646 Posts
    Blog Entries
    3
    My Mood
    Cynical

    Default Re: and you thought that food shortages were paranoid delusions ...

    the massive price increases in rice / wheat / corn are having secondary effects as well. From a professional investor's BBS ...

    (snip)"Manitoba is slaughtering tens of thousands of pigs because their input costs have them selling at a $100 loss per head. The ten pounds of grain it takes to make one pound of meat is outbid by the asians and the energy equivalency is nowhere near equal. This will become an important economic consideration moving forward as energy equivalency becomes a larger concern in economic equations"(snip)


    .... in other words, the pricing of meats, poultry etc. have yet to rise to 'break even' levels compared to the necessary 'input costs' (i.e. livestock feed). This will also either result in shortages, or major price increases (or some combination of both)

  4. #4
    Banned Eric Stoner's Avatar
    Joined
    Oct 2006
    Location
    NYC
    Posts
    5,150
    Thanks
    1,261
    Thanked 1,430 Times in 888 Posts

    Default Re: and you thought that food shortages were paranoid delusions ...

    And our Wonderful Congress is working on a Farm Bill that will continue to subsidize millionaire farmers and pay them NOT to grow food. Not to mention continuing the insane ethanol subsidies.

  5. #5
    Veteran Member LadyLuck's Avatar
    Joined
    Feb 2008
    Location
    USA
    Posts
    521
    Thanks
    0
    Thanked 0 Times in 0 Posts

    Default Re: and you thought that food shortages were paranoid delusions ...

    Who here said it was a paranoid delusion? I wonder if you are referring to me as I was ( at least the last time I checked your last food topic anyway) the only one who challenged what you seemed to be getting at with the topic.

    Granted it is an assumption on my part based on your extensive opposition to the use and development of biofuels. But I digress.

    I only said that food shortages are caused by a variety of issues rather than solely because of ethanol and that it has happened way before ethanol as well.

    I don’t understand how that could have been twisted so badly by you into a claim of you having been accused of paranoid delusions regarding food supplies but whatever

    Then again maybe your are refering to someone else. I sure hope so!
    There never was a good war or a bad peace.

    Benjamin Franklin

  6. #6
    Veteran Member LadyLuck's Avatar
    Joined
    Feb 2008
    Location
    USA
    Posts
    521
    Thanks
    0
    Thanked 0 Times in 0 Posts

    Default Re: and you thought that food shortages were paranoid delusions ...

    On a related subject. Poor rice farmers in China are actually getting a financial boost from this situation because their government has increased what the can earn with their crops. For those who may not know in China the government strictly regulates these things.


    Cause and effect can be a fickle thing. What hurts many can also help many. The world is fuuny like that.
    There never was a good war or a bad peace.

    Benjamin Franklin

  7. #7
    Banned Eric Stoner's Avatar
    Joined
    Oct 2006
    Location
    NYC
    Posts
    5,150
    Thanks
    1,261
    Thanked 1,430 Times in 888 Posts

    Default Re: and you thought that food shortages were paranoid delusions ...

    Quote Originally Posted by LadyLuck View Post
    On a related subject. Poor rice farmers in China are actually getting a financial boost from this situation because their government has increased what the can earn with their crops. For those who may not know in China the government strictly regulates these things.


    Cause and effect can be a fickle thing. What hurts many can also help many. The world is fuuny like that.
    The issue is the SUPPLY of food which is inadequate to meet current demand. Using corn for ethanol has lowered supply. Soybean farmers are now growing corn. Wheat farmers are now growing corn. Australia is suffering from a severe drought aqnd can't export wheat. Argentina and other former food exporters are restricting exports to assure adequate domestic supplies. Europeans have refused to revise ethanol targets despite dropping food supplies.

    Aside from drought and wheat rust, all of the current shortages flow directly from GOVERNMENT ethanol policies.

  8. #8
    Veteran Member LadyLuck's Avatar
    Joined
    Feb 2008
    Location
    USA
    Posts
    521
    Thanks
    0
    Thanked 0 Times in 0 Posts

    Default Re: and you thought that food shortages were paranoid delusions ...

    By the way some of the variety of non ethanol causes are covered quite well in this link below. Current ethanol interest has indeed had some effect on the situation but is far, far from the main or even a major cause of food shortages. Things such as physical and biological factors, social and cultural factors and political and economic factors are actually the main causes. Anyone who says otherwise is VASTLY uniformed and should be ignored.

    For an in depth look at what causes food shortages take a look at this:
    There never was a good war or a bad peace.

    Benjamin Franklin

  9. #9
    Banned Melonie's Avatar
    Joined
    Jul 2002
    Location
    way south of the border
    Posts
    25,932
    Thanks
    612
    Thanked 10,563 Times in 4,646 Posts
    Blog Entries
    3
    My Mood
    Cynical

    Default Re: and you thought that food shortages were paranoid delusions ...

    ^^^ I read the university analysis, and it correctly addresses a whole bunch of issues that affect 'agricultural production' levels. However, it makes no mention of the gov't mandated redirection of X percent of total agricultural production between foods and biofuels feedstock. Thus it is entirely possible that US agricultural production as a whole will increase this year, but mandated redirection of X percent of agricultural production towards biofuels will grow a LOT, thereby causing the remaining agricultural production applied to foods to decline. Speculative reports have projected that by 2010 some 33% of total US agricultural production capacity will need to be devoted to ethanol feedstock crops alone.

    Also, as was clearly stated in the first two posts, there won't be a shortage of rice in America. What their will be is a shortage of LOW PRICED IMPORTED rice from Asian countries. The reason that these exports are becoming less available to US customers is primarily due to embargos being imposed by the Asian gov'ts, who undoubtedly plan to consume a greater amount of their own domestic rice production to forestall the necessity of importing their 'normal' amounts of world market wheat etc. - because world market wheat etc. prices have been driven sky high due to diversion of fertilizer and EU / US farmland to produce biofuel feedstocks.

    So yes there will be plenty of US rice on market shelves ... but at twice the former price of imported asian rice. Why the price difference ? Well, it starts with a $7.50 per hour mandatory US minimum wage, versus $1 per hour in Asia. It continues with the prohibition of cheap but highly effective pesticides like DDT for EU / US farm use, forcing the use of more expensive pesticides of arguable effectiveness. And last but not least, it concerns 'free market' forces that are trying to equalize the profits possible from using prime US farmland to produce food crops, versus producing biofuels feedstock crops whick kick back a production tax credit from the US treasury (currently 99 cents per gallon for biodiesel, and 51 cents per gallon for ethanol). So yes the available gov't subsidies for one particular crop also affect the market price of other crops if they must compete for the same finite amount of prime US farmland.
    Last edited by Melonie; 04-24-2008 at 01:37 PM.

  10. #10
    God/dess Deogol's Avatar
    Joined
    Dec 2003
    Posts
    5,493
    Thanks
    120
    Thanked 50 Times in 35 Posts

    Default Re: and you thought that food shortages were paranoid delusions ...

    There was a time when we thought $2/gal gasoline was a temporary thing.

  11. #11
    Banned Melonie's Avatar
    Joined
    Jul 2002
    Location
    way south of the border
    Posts
    25,932
    Thanks
    612
    Thanked 10,563 Times in 4,646 Posts
    Blog Entries
    3
    My Mood
    Cynical

    Default Re: and you thought that food shortages were paranoid delusions ...

    ^^^ well there are really two factors at work in regard to gasoline and food prices. The first is described above i.e. the US / EU gov't mandates which have created a situation where agricultural capacity is now in direct competition to produce food versus producing (bio)fuel. This has had the presumably unintended consequence of tying food prices to fuel prices, thus the world market pricing of various foods is becoming increasingly linked to the food's (ever more expensive) equivalent energy content.

    I included the 'presumably unintended' since there is a conspiracy theory out there involving the US / EU employment of Machiavellian principles to 'leverage' oil producing countries via the creation of international market food shortages at any price. Thus countries that are capable of producing all the food required for domestic consumption have a major advantage over countries primarily consisting of sand dunes and Sovereign Wealth Funds - but that's a topic for a different thread.

    However, the second factor relates exclusively to the US dollar's exchange rate in the world market. This is an increasingly important factor because the US is now a large net importer of both fuel and food. Thus US gov't economic policies which affect the international exchange rate of the US dollar translate directly into changing prices for fuel and food purchased on international markets for import.

    There is another point that bears mentioning. Like stock shares or any other commodity that is bought and sold in open markets, the price of fuel and food are set 'at the margin' ... where supply and demand achieve a price balance. However, since the US is no longer a net producer of either fuel or food, the 'margin' pricing point is now set by the willingness of foreign countries to supply fuel or food to the international market. Lately it has been export supply policy changes by the Saudis, the Chinese, by other Asian countries etc. that has effectively reduced the available international market supplies of fuel and food ... which has directly translated into upward price pressure for fuel and food independent of US dollar exchange rate declines.

    Today UN Secretary General Ban-Ki Moon has called the developing food price increases / shortages situation a 'global crisis'.



    ~
    Last edited by Melonie; 04-25-2008 at 05:46 AM.

  12. #12
    Banned Eric Stoner's Avatar
    Joined
    Oct 2006
    Location
    NYC
    Posts
    5,150
    Thanks
    1,261
    Thanked 1,430 Times in 888 Posts

    Default Re: and you thought that food shortages were paranoid delusions ...

    Quote Originally Posted by LadyLuck View Post
    By the way some of the variety of non ethanol causes are covered quite well in this link below. Current ethanol interest has indeed had some effect on the situation but is far, far from the main or even a major cause of food shortages. Things such as physical and biological factors, social and cultural factors and political and economic factors are actually the main causes. Anyone who says otherwise is VASTLY uniformed and should be ignored.

    For an in depth look at what causes food shortages take a look at this:


    http://www.unu.edu/unupress/unupbook...0of%20shortage
    I did not make myself adequately clear. The world-wide grain shortage has a multiplicity of causes BUT the U.S. shortages are caused primarily by diversion of corn to ethanol production and conversion of other production to corn.

Similar Threads

  1. weekend commentary - Investors' Food for Thought'
    By Melonie in forum Dollar Den
    Replies: 0
    Last Post: 10-23-2011, 02:24 PM
  2. Replies: 4
    Last Post: 12-14-2010, 03:48 PM
  3. Replies: 2
    Last Post: 01-12-2010, 09:14 AM
  4. Paranoid... >_>
    By Lysondra in forum The Lounge
    Replies: 7
    Last Post: 08-17-2006, 08:43 AM
  5. food for thought re Medical Insurance costs
    By Melonie in forum Political Poo
    Replies: 3
    Last Post: 05-02-2005, 08:32 PM

Bookmarks

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •