Why Food Prices Are Going Up?

[pywong]

Food has been in the news lately. Here are some useful information:

Why Food Prices Are Going Up?

Fallacy No. 1: The surge in demand from China and India. Hundreds of millions of people are joining the middle class each year, and that means they want to eat more and better food.

Fact: Rice has been the staple food of half the world for centuries, and it is hardly rich man’s fare. Moreover, according to an April 2008 analysis from the United Nations' Food and Agriculture Organization, food consumption of grains has gone up by only one percent since 2006. That hardly explains the fact that the price of rice has spiked by 75 percent in just two months. The price of Thai 100 per cent B grade white rice, considered the world’s benchmark, has tripled since early 2007; and it jumped 10 percent in just one week.

Fallacy No. 2: Growing demand for ethanol as a fuel additive.

Fact: Bio-fuels have drained off some of this grain, but biofuels did not suddenly happen, the rise in food prices would have been gradual and predictable to match.

REAL REASON:
Conventional economic theory says that prices are driven up when “demand” exceeds “supply.” But in this case “demand” does not mean the number of hands reaching out for food. It means the amount of money competing for existing supplies. The global food crisis has resulted from an increase, not in the number of mouths to be fed, but simply in the price.

It is the money supply that has gone up, most of it in the futures market, where fund managers seek to maximize their profits by using futures contracts. The “hot money” that has fled the collapsed real estate bubble is now moving into the commodities bubble, and that includes food.

That's not much consolation for the poor trying to stretch their dollars.

[racheljansz]

Yup, good thing is that rice is has no future...err futures market that is :D
This food futures market is killing the population! :mad:

[pywong]

Yup, good thing is that rice is has no future...err futures market that is :D
This food futures market is killing the population! :mad:
Rachel,

I remembered reading that there is no futures market for rice. In that case, the rise in price of rice can't be explained by hedge funds. There has to be some other factor - hoarding by speculators?

Things are all coming together. Oil rise, commodities rise, precious metals rise. the financial markets wobbling. I have tried to explain this phenomenon from the standpoint of the International Financial Class (IFC) manipulating the world market to make money (see The Rat Race Part IV - The Pyramid). I am still trying to sort out these ideas and testing it real-time to see whether the theory works. Time will tell.

[denver]

Food has been in the news lately. Here are some useful information:

Why Food Prices Are Going Up?

Fallacy No. 1: The surge in demand from China and India. Hundreds of millions of people are joining the middle class each year, and that means they want to eat more and better food.

Fact: Rice has been the staple food of half the world for centuries, and it is hardly rich man’s fare. Moreover, according to an April 2008 analysis from the United Nations' Food and Agriculture Organization, food consumption of grains has gone up by only one percent since 2006. That hardly explains the fact that the price of rice has spiked by 75 percent in just two months. The price of Thai 100 per cent B grade white rice, considered the world’s benchmark, has tripled since early 2007; and it jumped 10 percent in just one week.

Fallacy No. 2: Growing demand for ethanol as a fuel additive.

Fact: Bio-fuels have drained off some of this grain, but biofuels did not suddenly happen, the rise in food prices would have been gradual and predictable to match.

REAL REASON:
Conventional economic theory says that prices are driven up when “demand” exceeds “supply.” But in this case “demand” does not mean the number of hands reaching out for food. It means the amount of money competing for existing supplies. The global food crisis has resulted from an increase, not in the number of mouths to be fed, but simply in the price.

It is the money supply that has gone up, most of it in the futures market, where fund managers seek to maximize their profits by using futures contracts. The “hot money” that has fled the collapsed real estate bubble is now moving into the commodities bubble, and that includes food.

That's not much consolation for the poor trying to stretch their dollars.

Interesting, but may I know the source of this findings? I'm only asking because your findings seems to contradict major global research on the causes of increasing food prices.

For example, in this BBC News article, it says the reason food prices are increasing worlwide is because:

1. World population is increasing, we have reach the point where there are simply too many mouths to feed
2. Rise of India and China economies. Rich people simply eat more than poor people.
3. Climate change and frequent floodings affecting crop yields
4. Biofuels - in the US, 30% of corn crop is being used for bio fuels, thus pushing up the price of corn flour on international commodity markets.

And this is the facts and figures on the global rise in food rices: http://news.bbc.co.uk/2/hi/7284196.stm

I'm interested to see if there are any other or the "real" causes of food price increase, and the supporting facts, of course. Because, you need to know the exact cause before you can find a cure.

[pywong]

I'm interested to see if there are any other or the "real" causes of food price increase, and the supporting facts, of course. Because, you need to know the exact cause before you can find a cure.
Denver,

Thank you for the link. It is entirely possible that the BBC is absolutely correct. The article I referred to here:
http://www.webofdebt.com/articles/global-food-crisis.php
look at it from the perspective of hedge fund speculation. Hedge funds look for small discrepancies in the financial markets and use leverage to amplify the differentials that they can make by betting on one side of the market. They found that there was some shortage in certain areas of the food market. By cornering the market, they forced prices to rise way above what a normal shortage will justify.

The news which in many cases is just "noise" helps to "explain" why prices rise. On the surface the reasons seem sensible. What I am saying is, at this point in time, we cannot really "know" the true reason for the rise. It could be food shortage. It could be speculation. It could be both. We have to wait until it is all over before we can really tell the reason. By that time, some people would have made a killing.

I have tried to suggest here The Rat Race Part IV (http://www.usj.com.my/bulletin/upload/showthread.php?t=22660) that the international news media could be part of a global conspiracy out to mislead and manipulate us. It could just be whistling in the wind. We never know. There is strong evidence to suggest this is the case where the US stock market, financial services and gold market is concerned. It is up to us to decide whether to accept it or not. Personally, using that concept has helped me to "see" things better.

I don't think there is any cure for the greed of man.

[Weezy]

no wonder i had to pay rm 3.50 for a plate of half rice and 3 vegetable!!!!! :mad:

[firefox]

Denver,



I don't think there is any cure for the greed of man.

This is the only valid reason i too know for the price increases nothing else.

[bslee]

Time and again has proven that the moment that greed is the single most evident motivation for price inflation and it hurts most rakyat badly, especially if this country are net importers of many items. Again, nothing much the rakyat can do except to curb and control own desires and spending habits and life doesn't really become more meaningful. Sad!. Don't expect the BN gahmen to help much..they yak nonsense in Parliament just about too much.

[gary yap]

no wonder i had to pay rm 3.50 for a plate of half rice and 3 vegetable!!!!! :mad:

I tapau mamak food, curry chicken(3 small pieces) and long beans. Doesn't look that pack but kena charge RM4.80 instead of the usual RM4.20.

[racheljansz]

Rachel,
I remembered reading that there is no futures market for rice. In that case, the rise in price of rice can't be explained by hedge funds. There has to be some other factor - hoarding by speculators?
Like I said "good thing is that rice is has no future...err futures market"
or else it will be even worse with the huge amounts of dirty money artificially pushing up the price of rice!

What are the contributing factors for this increase is (according to racheljansz opinion):-
China Olympic games.
Chinese are buying a lot of rice not just because bad harvest but they cannot afford not to have rice during this event.
Boh Bin la, no no where to hide face. :D

This is also a contributing factor to the price rise in Chinese Herbs, Dry/Preserve fruits/food & Tea.
Also includes other food stuff that has a long shelf-life, that China buys.- (Palm oil)
This domino effect is causing problems to the regular buyers - Asian and African who suddenly find interruptions in their supply.
What else to do but to offer higher price to ease these interruptions of the essential staple food.

Now that the price has increase we should get to see herd instinct and vultures at work.
and ah yes ... the greed of man?

This Bolehland was at one time self-sufficient in rice production.
I should know because my 1st Job was to sit at Lembaga Padi Negara office very early in the morning,
waiting for permit to transport the rice out of Kedah.
Today some of these padi field sits idle or worse houses/ complex sits on it!
The government does not see Padi Farmers as 'towering bumiputras'
Maybe UMNOputra just see the land$ only.
Maybe they are so fixate on getting the Malays off the hot sun and muddy padi fields that they forgot they have nobody left to produce the staple food?

At least AAB is trying to bring back the agri/agro sector to modern times with modern methods & thinking.
Oops did I just said that! :D
But it will only work if they do not choose the color of the cat.
Our neighboring up north, Thailand, at one time were not even able to produce the quality rice that some farmer in Kedah were.
Today these thais are a decade or two ahead of us!
Not only in terms of quality or quantity or yield/hectare but also in terms of export marketing!
Be it rice or fruits or fish or anything agriculture, at every International Food Shows their govt seems to provided lots support - facilities, incentives & manpower...err..."well trained female promoters holding agro/agri based degree" as per my ex-boss discription. (Do not know if it is pcyeoh's member :D , my apologies pcyeoh)

Today they are proud of this agriculture heritage, from Royalty right down to the man-in-the-street, which is earning big bucks internationally.
Some one mention in this forum, due to increase food prices best thing is go into food business? :D

[pywong]

Like I said "good thing is that rice is has no future...err futures market"
or else it will be even worse with the huge amounts of dirty money artificially pushing up the price of rice!

What are the contributing factors for this increase is (according to racheljansz opinion):-
China Olympic games.
Chinese are buying a lot of rice not just because bad harvest but they cannot afford not to have rice during this event.
Boh Bin la, no no where to hide face. :D

This is also a contributing factor to the price rise in Chinese Herbs, Dry/Preserve fruits/food & Tea.
Also includes other food stuff that has a long shelf-life, that China buys.- (Palm oil)
This domino effect is causing problems to the regular buyers - Asian and African who suddenly find interruptions in their supply.
What else to do but to offer higher price to ease these interruptions of the essential staple food.

Now that the price has increase we should get to see herd instinct and vultures at work.
and ah yes ... the greed of man?

This Bolehland was at one time self-sufficient in rice production.
I should know because my 1st Job was to sit at Lembaga Padi Negara office very early in the morning,
waiting for permit to transport the rice out of Kedah.
Today some of these padi field sits idle or worse houses/ complex sits on it!
The government does not see Padi Farmers as 'towering bumiputras'
Maybe UMNOputra just see the land$ only.
Maybe they are so fixate on getting the Malays off the hot sun and muddy padi fields that they forgot they have nobody left to produce the staple food?

At least AAB is trying to bring back the agri/agro sector to modern times with modern methods & thinking.
Oops did I just said that! :D
But it will only work if they do not choose the color of the cat.
Our neighboring up north, Thailand, at one time were not even able to produce the quality rice that some farmer in Kedah were.
Today these thais are a decade or two ahead of us!
Not only in terms of quality or quantity or yield/hectare but also in terms of export marketing!
Be it rice or fruits or fish or anything agriculture, at every International Food Shows their govt seems to provided lots support - facilities, incentives & manpower...err..."well trained female promoters holding agro/agri based degree" as per my ex-boss discription. (Do not know if it is pcyeoh's member :D , my apologies pcyeoh)

Today they are proud of this agriculture heritage, from Royalty right down to the man-in-the-street, which is earning big bucks internationally.
Some one mention in this forum, due to increase food prices best thing is go into food business? :D
Good points, Rachel. I remembered someone advised: "Change your lifestyle". :D

I won't call names this time. Must jaga my banana quota. :D

On a personal level, I am going to do some planting on an empty plot near my house - more for exercise than anything. If we all do our little bit, it can make a difference.

[Jey]

Anyone knows why the ingredients used for food is going UP like mad. ALL ingredients are going up like never before. Wet groceries, dry groceries, cooking ingredients, condensed milk, RICE, ....you name it....
:( :confused: :eek:

[racheljansz]

Anyone knows why the ingredients used for food is going UP like mad. ALL ingredients are going up like never before. Wet groceries, dry groceries, cooking ingredients, condensed milk, RICE, ....you name it....
:( :confused: :eek:as mention

... the greed of man.

This is the only valid reason i too know for the price increases (&) nothing else.

[pywong]

as mention
Psst. Your PM message box is full. :)

[Jey]

as mention

When has man ever been NOT greedy? :confused:
This is like prior to the increase man has not been greedy? :D

[Joe Gomez]

Psst. Your PM message box is full. :) R U back in town ?

[pywong]

Here is another plausible reason for price increase:

In the space of 8 months, the US Fed has cut the Federal Funds Target Rate and the Discount Rate. These now stand at 2% and 2.25%, down from 5.25% and 6.25% when the cutting started in Aug 07. These are very large cuts and now the interest rate is, after discounting inflation, negative. This has made the USD less popular leading to a devaluation of the dollar and speculators moving their funds from the USD to other assets.

First they started with metals, oil, minerals, etc. Now they are shifting their focus to food. With a few droughts in the growing areas or floods in other areas, an increase in demand due to the growing economies of China and India. the sharp increase in money chasing a reducing amount of food has given the food price a huge spike.

Read on: http://atimes.com/atimes/Global_Economy/JE02Dj03.html

Again the question: What can we do?

The only solution I can think of is: Grow your own food, even some vegetables in a pot will help if enough people do it. I urge you. Do something about it.

[pywong]

http://www.washingtonpost.com/wp-dyn/content/article/2008/04/29/AR2008042902880.html?hpid=topnews
All these bubbles are building up towards a crescendo.

There are various estimates of how much of this new investment money flowed into these vehicles in the past two years. Philip Verleger, an economist who closely studies commodity markets, estimates that the inflow was running at an average of $100 million a day during most of 2006 and 2007, rising to as much as $1 billion a day during the frenzied trading days of February and March. J.P. Morgan put the amount at between $150 billion and $270 billion. And the Bank for International Settlements estimates that the value of all the derivative contracts traded on the unregulated over-the-counter markets surged from about $3 trillion in the spring of 2005 to more than $8 trillion today.

Whatever the number, it's hard to imagine that it wasn't a significant factor in skyrocking prices

See related link here:
Financial Crisis (http://www.usj.com.my/bulletin/upload/showthread.php?t=22392&page=1&pp=15)

Events do not occur in isolation. They are all inter-linked and when their effects resonate at a critical point, a tsunami or a perfect storm may break out.

[orchipalar]

Err buddy Pywong...has it ever occurred to you that besides greed...the humans' age old instinct of hoarding...has mainly contributed to the rise of prices of food items...minerals...metals...etc etc n the petroleum products...???

[pywong]

Err buddy Pywong...has it ever occurred to you that besides greed...the humans' age old instinct of hoarding...has mainly contributed to the rise of prices of food items...minerals...metals...etc etc n the petroleum products...???
Orchi, 2 primordial instincts - greed and fear. Mentioned in the Rat Race articles.

The overwhelming factor is huge amounts of speculation money, in the hundreds of billions.

[orchipalar]

Err buddy Pywong...talking about rising oil prices...the USA in itself...has some of the largest man made pits or storage facilities...to keep amongst other commodities...Crude Petroleum Oil...that would last for over 150 days for its domestic consumption...n there are new pits being constructed as we speak...to keep more...thus also pushing the prices higher for the commodity which is feared to have reached the much anticipated effects of the "peak oil period"...

In China...n India...similar or larger pits have been constructed...n more of such pits are to be constructed in the next few years...to hoard enough supply of such commodity to withstand 300 days for their domestic consumptions...for the fear of the same effect of "peak oil period" happening in these 2 countries that have combined populations equal to 1/2 of the world's total populations in nearest future...

[pywong]

Err buddy Pywong...talking about rising oil prices...the USA in itself...has some of the largest man made pits or storage facilities...to keep amongst other commodities...Crude Petroleum Oil...that would last for over 150 days for its domestic consumption...n there are new pits being constructed as we speak...to keep more...thus also pushing the prices higher for the commodity which is feared to have reached the much anticipated effects of the "peak oil period"...

In China...n India...similar or larger pits have been constructed...n more of such pits are to be constructed in the next few years...to hoard enough supply of such commodity to withstand 300 days for their domestic consumptions...for the fear of the same effect of "peak oil period" happening in these 2 countries that have combined populations equal to 1/2 of the world's total populations in nearest future...
Orchi, those salt domes are for strategic supply during war, not for peak oil. After 300 days of using the supply, then what? The Peak Oil problem is not going to go away.

Certain things are beyond our control. Worry about the stuff that we can control. What we cannot control, make sure that we are not in the way. Could be very painful. :D

[pywong]

Err buddy Pywong...talking about rising oil prices...the USA in itself...has some of the largest man made pits or storage facilities...to keep amongst other commodities...Crude Petroleum Oil...that would last for over 150 days for its domestic consumption...n there are new pits being constructed as we speak...to keep more...
Orchi, here are some numbers for you to work your mind around:

The world uses 31 Billion barrels of oil each year. The US inventory is less than 1% of this annual consumption! Inventory only acts as a buffer between supply and demand it can never be a significant part of supply except for a few days!

Check the capacity of the US Salt domes. The US consumes about 25% of global oil supply, around 20.1 million barrels/day http://www.oilvoice.com/n/US_Oil_Consumption_Declines/ff895835.aspx. 150 day storage means 3 billion barrels. Mucho big, oh. Sure, ah? :D

[pywong]

Reasons: Hoarding & speculators.

http://www.ipsnews.net/news.asp?idnews=42246

MALAYSIA: Food Futures Behind Rising Prices
Analysis by Anil Netto

[pywong]

This chart shows corn prices going up by more than 40% in 6 months.
http://futures.tradingcharts.com/chart/CN/78

Also corn is blowing through technical resistance, making its own all-time high, as rainy weather conditions in the US Midwest are making planting difficult. If you can’t get corn into the ground, obviously it cannot grow. Most of the time farmers are able to get the job done, but this year is proving to be extraordinarily difficult.

Corn prices increase will make its way into other food price increase as people "change their lifestyle" and choose cheaper types of food.

[pywong]

Anilnetto: 8 May 08

Who’s profiting from higher food prices? Certainly not the rice farmers

Some people are making big bucks from the higher prices of food, including rice.

But not the farmers.

.... http://anilnetto.com/2008/05/09/whos-profiting-from-higher-food-prices-certainly-not-the-rice-farmers/

[wsp]

cannot tahan anymore.... rice increase 100% per kg, nasi goreng, bihun... and flour also goes up

how to survive with my pathetic salary increment??

[pywong]

cannot tahan anymore.... rice increase 100% per kg, nasi goreng, bihun... and flour also goes up

how to survive with my pathetic salary increment??
Yes, it is quite tough. Have you considered doing some side business to supplement your income? I know many people are holding 2 jobs or doing some business to cope.

Please give some thought to that.

[gary yap]

Any advise on that? I know of some doing part-time insurance. Crazy la, RM50 buy nothing! :confused: Once you break it, it's gone in 60 seconds!!!

[pywong]

Any advise on that? I know of some doing part-time insurance. Crazy la, RM50 buy nothing! :confused: Once you break it, it's gone in 60 seconds!!!
It may sound cliche but the best advice I know of is to invest in ourselves.

Do any honest business that will increase your knowledge level. Your assets are your time, your knowledge, your credibility, your competency, your leadership skills. Invest time to develop them.

[Joe Gomez]

It may sound cliche but the best advice I know of is to invest in ourselves.

Do any honest business that will increase your knowledge level. Your assets are your time, your knowledge, your credibility, your competency, your leadership skills. Invest time to develop them.And do that continually ........... not just during recessionary times or times when there is more month left at the end of the money.
Cliched ? Maybe .......... but appropriate nevertheless, py.

[Sato]

Today i was doing some small shopping in Giant Puchong, the price for a bag of 10 kg "beras wangi" now is RM45 plus (Pearl Fragrance Rice) :eek: previously its only RM28! :mad:

[CS Chua]

Today i was doing some small shopping in Giant Puchong, the price for a bag of 10 kg "beras wangi" now is RM45 plus (Pearl Fragrance Rice) :eek: previously its only RM28! :mad:
Opec has their oil cartel. Now Thailand, Cambodia and gang have formed their rice cartel. Everybody wants a piece of the cake by pushing price up to make unreasonable profits.

I say, Malaysia and Indonesia should form a palm oil cartel and push palm oil to RM10K a ton. That will make their margarine and soap very expensive. :D When they are suffering from margarine withdrawal and becoming very smelly, we can start negotiating for a better price for rice and oil. :cool:

[pywong]

I am a bit puzzled by this arrangement of having a privatised monopoly for a price-controlled item.

Bernas is a private company.
They have the monopoly on rice import.
Rice is a controlled item. So we can assume that the govt is subsidising the price.

Why are we subsidising something that enables the private sector to make RM 107.3 million? Through financial engineering, probably the real profit is much higher. That profit comes from the govt subsidy, meaning govt is giving money to Bernas. Why would we want to do that?

[Sato]

I am a bit puzzled by this arrangement of having a privatised monopoly for a price-controlled item.

Bernas is a private company.
They have the monopoly on rice import.
Rice is a controlled item. So we can assume that the govt is subsidising the price.

Why are we subsidising something that enables the private sector to make RM 107.3 million? Through financial engineering, probably the real profit is much higher. That profit comes from the govt subsidy, meaning govt is giving money to Bernas. Why would we want to do that?

Who is the "real boss" behind this Bernas company?

[pywong]

Who is the "real boss" behind this Bernas company?
Ex-Perlis MB, Shahidan??? Hearsay only, not sure.

[pywong]

Who is the "real boss" behind this Bernas company?
Syed Mokhtar 37.18%

Wan Tak Co 25.46%

Lembaga Tabung Haji 6.19%

http://www.theedgedaily.com/cms/content.jsp?id=com.tms.cms.article.Article_602a4c7 8-cb73c03a-c1186f00-da34cdad

[pywong]

I am not too sure that is only a supply problem. Anyway, the rich countries can help by

1. stopping the plan to convert food to fuel.

2. Ban the hedge funds from speculating in essential food

Surefire recipe for social unrest
Friday, 16 May 2008

GLOBAL SPIKE IN FOOD PRICES

Food inflation, like rising oil prices, is ultimately driven by the entrance into the international marketplace of hundreds of millions of new consumers. That's why food shocks - and the threats they pose for social and political stability in dozens of countries - will be with us for some time to come.

By Ian Bremmer

http://www.malaysia-today.net/2008/content/view/7488/84/

*************

A 'silent tsunami' for the world's poor

Friday, 16 May 2008

The Straits Times

World food prices jumped 43 per cent last year and are on track to eclipse that this year. It is even worse for many staples of the developing world diet: wheat prices are up 146 per cent over just the past year.

THE global food crisis has sparked riots in more than 30 countries and poses a threat to 'peace and stability', the executive director of the United Nations World Food Program told a US Senate committee.

With more than 860 million people already going hungry worldwide

............. http://www.malaysia-today.net/2008/content/view/7487/84/

[AllUrban]

I am a bit puzzled by this arrangement of having a privatised monopoly for a price-controlled item.

Bernas is a private company.
They have the monopoly on rice import.
Rice is a controlled item. So we can assume that the govt is subsidising the price.

Why are we subsidising something that enables the private sector to make RM 107.3 million? Through financial engineering, probably the real profit is much higher. That profit comes from the govt subsidy, meaning govt is giving money to Bernas. Why would we want to do that?you really have to wonder why the Ministry of Domestic Trade and Consumer Affairs has basically said nothing about the increased prices of rice (especially in recent days). When the flour millers wanted to increase the price of flour, they refused as long as possible. If the price of roti canai increases at some hawker stall, they are there.

But when the well-connected private company (Bernas) that has the monopoly on rice import and most of the distribution of rice in Malaysia wants the price to go up...what is the Ministry of Domestic Trade and Consumer Affairs going to do???

According to sources, Bernas underpays the padi farmers and overprices the packaged rice...so they are profiting right now at the expense of the farmers and the consumers...and I bet that they are using the price inflation to inflate their profits as well!


Opec has their oil cartel. Now Thailand, Cambodia and gang have formed their rice cartel. Everybody wants a piece of the cake by pushing price up to make unreasonable profits.

I say, Malaysia and Indonesia should form a palm oil cartel and push palm oil to RM10K a ton. That will make their margarine and soap very expensive. :D When they are suffering from margarine withdrawal and becoming very smelly, we can start negotiating for a better price for rice and oil. :cool:hehhehe interesting idea...tho to be fair, must point out that they have put the rice cartel idea on the shelf for now...

Cheers, m

[pywong]

The US Lawmakers are blaming the hedge funds. Actually, the funds are fleeing the USD because the US Fed is printing too much money to bail out the Financial Class, causing inflation and devaluation of the dollar.

To protect their buying power, these funds are forced to park their USD in commodities. Hence the surge in prices. Their actions are just a symptom of currency instability.

The culprit is the Fed, not the hedge funds. But politicians never like to face inconvenient truth, especially if it involves their cronies.

Politicians and financiers: A potent & toxic mix.

Commodity Trading Rules May Need Strengthening, Lawmakers Say

By Alan Bjerga

May 20 (Bloomberg) -- The U.S. Commodity Futures Trading Commission may be failing to adequately police speculative investing in markets for crops such as corn and wheat as food prices surge, lawmakers said.

``The people of America are about to pick up pitchforks'' as rising food costs pinch consumer budgets, Democratic Senator Claire McCaskill of Missouri told CFTC Chief Economist Jeffrey Harris today at the hearing in Washington.

[bslee]

I had noticed that there's a brand of sliced cheese made in UAE. They can manufacture or process chesse THERE!. Here?..we're at the blardi mercy of food item importers who'll raise the price whenever they feel like it. The price of premium butter (its NORMAL quality for the country of origin, here its PREMIUM) for breakfast now shoots thought the ROOF! at somewhere RM7 onwards (brands especially from Down under and NZ). Here we have Buttercup brand selling at RM4 or more and thats POOR quality tasting butter!.

We Malaysians can't make or process our own quality butter and cheese till when?. We can't even make our own quality JAM for God sake!. The local jam is more like JELLY!. Even Walls, Magnolia, Lady's choice products (from China now), ice-cream comes from Thailand or Indonesia. They used to make it here before.. SOMETHING VERY WRONG WITH THIS DAMN COUNTRY we call home!

[geordie]

The increase in the price of rice has been incredible too in so-called non-rice eating countries.

For example, in England, it is now about 16 quid for 10 kilos. A month or two ago, it was a mere 8 quid. And in many places, you are limited as to the amount of bags you can buy.

In December last year, our favourite Chinese takeaway lady boss was complaining about a bag of green peas is now double the cost. Cooking oil is on the rise too. So, the dilemma for those in the foodie industry is the same the whole world over. Cost of ingredients have increased tremendously but price on the menu remains more or less the same for fear of losing their clientele.

[bslee]

For example, in England, it is now about 16 quid for 10 kilos. A month or two ago, it was a mere 8 quid.


Hey geordie.. Lets not do any conversion.
16 quid for 10kilos.
32+ ringgit for 10kilos.

Its still a saver for them!. They earn in UK Pounds...we earn is devalued Ringgit!. Their purchasing power is still much higher than us!.
Police Constable there can live decently in a decent house, family and decent comfort.
Police Constable here (even after 50 years of independence) likely resort to sharing police barracks, rent a room or wooden kampung home..Don't even dream of renting a terrace home, a family with 2-3 kids, or owning a decent car to boot (15 year old used car is a possibility!). No wonder PC's here can go haywire and corrupted.
A music CD there cost around 10UK pounds which is we see 10 bucks for a CD here in Malaysia and it costs RM40+ (bigger fraction of one's paycheck). No wonder piracy and street walking DVD peddlers ain't rampant there.
I just HAVE NO CONFIDENCE our beloved Malaysia will catch up to the competition and be at par!...NOT with this BN led gahmen in charge!..and even if it can happen, it'll NOT likely be in my lifetime.

[pywong]

Relax friends. Don't get your blood pressure up. You need to be healthy to run in the Rat Race. :D Your kids are counting on you.

Marie Antoinette (http://en.wikipedia.org/wiki/Marie_Antoinette) said: Let them eat cake.

She was guillotined for her trouble.

Our Najib said: Change your lifestyle.

I wonder what they are going to chop off for that statement?

Don't get too excited about the high food prices. Those are perishables, unlike precious metals.

Even if the hedge funds corner the market, eventually the price will come down. They are not going to eat the stuff. They just want to make a couple of bucks.

Meanwhile just grin and bear it. Next best thing is to do what I have started on:

Plant your own vegys. :D

My lady fingers have just sprouted. :)

[dwch]

I had noticed that there's a brand of sliced cheese made in UAE. They can manufacture or process chesse THERE!. Here?..we're at the blardi mercy of food item importers who'll raise the price whenever they feel like it. The price of premium butter (its NORMAL quality for the country of origin, here its PREMIUM) for breakfast now shoots thought the ROOF! at somewhere RM7 onwards (brands especially from Down under and NZ). Here we have Buttercup brand selling at RM4 or more and thats POOR quality tasting butter!.



http://www.abc.net.au/rural/news/stories/s929164.htm

http://smallbusiness.smh.com.au/managing/finance/holy-cow!-dairy-prices-skyrocket-911262467.html

http://www.abc.net.au/science/news/stories/2007/2078345.htm

Unfortunately Australia has been in severe drought for 10 years and the resevoirs in major citiess are only as low as 30 percent. As a result we are to limit ourselves to only a 5 min shower on a daily basis, install water tank to catch rainwater, use only recycle laundry water for our plants and on top of that all hand car washing has been banned.

[pywong]

Unfortunately Australia has been in severe drought for 10 years and the resevoirs in major citiess are only as low as 30 percent. As a result we are to limit ourselves to only a 5 min shower on a daily basis, install water tank to catch rainwater, use only recycle laundry water for our plants and on top of that all hand car washing has been banned.
dwch, I really wish you could talk to my wife about that. :(

[pywong]

This is one way to combat food prices.

Another way is to take responsibility for our food - grow it using organic method through recycling of our food waste.

PSM: Give farmers land to battle food crisis
Syed Jaymal Zahiid | Jun 4, 08 11:24am

Giving farmers their own land is one way of addressing the escalating global food crisis, said Parti Sosialis Malaysia (PSM).
MCPX

This was one of the issues in the 21-point resolution passed by the yet-to-be registered political party in its 10th congress in Port Dickson over the weekend.

..... http://malaysiakini.com/news/83907

[pywong]

This is why we are seeing oil prices shooting through the roof. The cheap USD is chasing for profits in commodities, sending prices skyrocketing. We are paying the price for that policy.

How can we protect ourselves: Get out of cash and into precious metals like gold.

Fed New York Bank Governor Timothy Geithner flew to Davos, Switzerland for the last annual World Economic Forum. In a closed-door session for central bankers and academics, Mr. Geithner forcefully defended the US Fed rate cuts.

The Fed had to "buy a significant amount of insurance" against a "rising probability of a really bad macroeconomic outcome." He didn’t deny that steep rate cuts risked fueling inflation. "The choice," he said, "is between which mistake is easier to correct: under-doing it or overdoing it."

The Fed would do whatever it took to avert a financial meltdown. Inflation would be dealt with later.

[pywong]

INFLATION:
Worldwide inflation is about 7%, says Bill Gross of PIMCO. And since price inflation has now been globalized, there is no escaping.

And yet Malaysia claims that our inflation is around 4%.

HIGH FOOD PRICES:
The solutions are not at all clear, but it is obvious that we need to begin to think locally. Food sources will need to be closer to the final consumers. The old way is simply not sustainable anymore.

In the brave new world, we will all likely have to become “locavores.” A locavore is someone who eats food grown locally. That would be a major shift difficult for most of us to fathom. But like it or not, it’s a change that is not going to be a choice. It will happen regardless of how much we fight it. Really, the question is how high of prices are we willing to pay in the meantime.

SOLUTION:
Grow your own food. Use earthworms to digest your food waste to produce organic fertilizers.

[pywong]

The issue is not food and commodity prices going up. The issue is the massive flooding of the financial markets with the USD and triggering of its devaluation. Holders of the USD are hiding their cash in commodities and precious metals to protect their purchasing power.

Joe's oily deception By Chris Powell
Published: Saturday, June 21, 2008 5:43 PM EDT

For mistaking symptoms for causes, it would be hard to outdo Connecticut U.S. Sen. Joseph I. Lieberman and Maine Sen. Susan Collins with their proposal to prohibit pension funds and government agencies from investing in commodities. Such investment, the senators claim, constitutes speculation and is largely responsible for the recent surge in commodity prices and general price inflation.

Of course there is always speculation in all markets, but Lieberman and Collins fail to ask the crucial question in regard to their own issue: Why the surge in commodities now?

...... http://www.journalinquirer.com/articles/2008/06/21/chris_powell/doc485c2ae888061262083314.txt

[pywong]

http://themalaysianinsider.com/index.php/business/8478-commodities-bubble-burns-big-investment-funds

Now you see the hedge funds getting whacked when the Central Banks collaborate to hammer down the commodity prices, gold and silver included. Will we see food prices coming down. Let's watch and see. What we can safely predict is that gold and silver will shoot up.