4-Mar-11 News -- Food prices surge again in February

[John]

4-Mar-11 News -- Food prices surge again in February

Arab League says that it may impose its own 'no fly zone' in Libya

** 4-Mar-11 News -- Food prices surge again in February
** http://www.generationaldynamics.com/cgi-bin/D.PL?xct=gd.e110304#e110304

Contents:
"Food prices surge again in February"
"Additional links"
The war continues in Libya
Arab League says that it may impose its own 'no fly zone' in Libya
China's human rights activists are disappearing
Cairo stock exchange to stay closed indefinitely

[OLD1953]

John, you didn't mention a major factor in food shortages, much agricultural land has been taken over by suburbs/cities/buildings, roads and other construction, especially in China. By some estimates (not Chinese govt, of course) as much as a quarter million acres of farmland will be submerged by a single project, the three gorges dam.

Given that cities are often sited where they are because of easy access to local food supplies, we'd have to conclude that urban sprawl may well kill the city it was intended to support.

[vincecate]

World food prices once again rose to fresh historic highs, for the eigth consecutive month. Prices rose 2.2% in one month from January to February, according to the UN Food and Agriculture Organization (FAO).

Of particular importance were the prices of cereals, which rose 3.7% in one month.

I understand this is not all prices but still, note that 5% per month or 80% per year is the cutoff I like for hyperinflation.

The "billion prices project" uses online prices to make real time price indexes. The one for the USA has gone up almost 1% per month the last 2 months.

http://bpp.mit.edu/daily-price-indexes/?country=USA

From 1914 to 1933 the Fed circulated 2.5 paper dollars for every 1 dollar worth of gold they held. This caused land, bond, and stock bubbles in the 1920s. But from 1929 to 1933 as people and countries turned in paper dollars for gold it was like they were removing this inflationary factor of 2.5 and prices went down. When the Fed stopped redeeming paper for gold the deflation stopped.

We do not have this deflationary thing happening this time. At some point the deflationists will have to admit that is not our problem. Best if they figure this out before we get to 5% per month.

http://howfiatdies.blogspot.com/2010/11 ... ndard.html

[Tom Acre]

The price of petroleum and the price of food are more closely linked than most realize. Almost every phase of our (United States of America) agricultural technology (which is being used by most of the world now) depends directly on oil. From the machines that plant, fertilize, and harvest to the fertilizer itself and the packaging, shipping and distribution, all of it depends on petroleum and the petrochemical industry. Aside from computer and information systems, there is no other that we all depend upon more. Nearly 7,000,000,000 people are simultaneously alive today b/c of it; like it or not no one has found anything to replace it. And most people just take it for granted, as if everything just magically happens and will continue no matter what.

[OLD1953]

Apart from shipping/processing, fertilizer is NOT dependant on oil. Fertilizer is processed minerals or ammonia produced from nitrogen/oxygen present in air.

[vincecate]

The "printing money makes international commodity prices go up" explanation fits fine. The "people growing faster than food supply" does not explain copper, iron, gold, silver, oil, etc etc. which are going up about as fast. And if you measure things in the currency XAU (gold), prices are not going up.

[Tom Acre]

Apart from shipping/processing, fertilizer is NOT dependant on oil...

Incorrect, virtually all fertilizers used to produce food start as an ammonia gas which is in turn produced from a reaction process from gas extracted from underground. The ammonia gas is then cooled and processed into fertilizers like ammonium nitrate (and other fertilizers).

[Guest]

To produce nitrogen fertilizer it takes a combustion reaction to convert the nitrogen gas in the air to fertilizer, in other words you have to burn something. In the case of nitrogen fertilizer it is usually natural gas.