tag:blogger.com,1999:blog-5235419263414453422.post2057529169869940479..comments2024-02-23T01:30:06.101-08:00Comments on Early Warning: New High in Food Commodity PricesStuart Stanifordhttp://www.blogger.com/profile/07182839827506265860noreply@blogger.comBlogger8125tag:blogger.com,1999:blog-5235419263414453422.post-74710796567934787242011-01-07T03:25:14.991-08:002011-01-07T03:25:14.991-08:00Alexander:
I speculate that higher food prices wi...Alexander:<br /><br />I speculate that higher food prices will have slightly complex effects on the size distribution. Obviously, it will raise farm profits for farmers of all sizes, and that will mean that it's easier for existing small farmers to hold on, instead of having to sell out after a couple of bad years. On the other hand, it will also raise the price of land, and that will mean that it's harder for someone without much capital to buy an existing small farm (or buy a large farm and split it up).<br /><br />It will still be true that there are significant economies of scale in industrial farming, such that large farms are more profitable than small farms.Stuart Stanifordhttps://www.blogger.com/profile/07182839827506265860noreply@blogger.comtag:blogger.com,1999:blog-5235419263414453422.post-82053561762273999712011-01-07T01:23:12.528-08:002011-01-07T01:23:12.528-08:00Stuart - does that mean that increasing food price...Stuart - does that mean that increasing food prices will make small-scale farmers more competitive (or less uncompetitive)?<br /><br />What will the "backward" process look like?Alexander Achttps://www.blogger.com/profile/16845172528191878930noreply@blogger.comtag:blogger.com,1999:blog-5235419263414453422.post-68190893890918450472011-01-06T15:29:55.344-08:002011-01-06T15:29:55.344-08:00Stuart,
Kjell Aleklett in his blog Aleklett´s Ene...Stuart,<br /><br />Kjell Aleklett in his blog Aleklett´s Energy Mix says that<br /><br />“Detailed studies in the USA show that 1 calorie of prepared food on the table requires, commercially, the equivalent of 7.4 calories to put it there. A global average is 5 calories per calorie of food on the table. Most of this is energy is from fossil fuels. If we take our food requirement of 12 million barrels of oil per day and multiply it by a factor of 5 we get 60 million barrels of oil equivalents per day which is 30% of all fossil fuel use. Those that call for zero carbon dioxide emissions by 2050 must first explain how an estimated 9 billion people will be fed.”<br /><br />http://aleklett.wordpress.com/2010/05/19/agriculture-as-provider-of-both-food-and-fuel-2/<br /><br />If he is right it should be fairly simple to estimate the influence of energy prices on food prices. If we eat 2500 kcal per day it takes 12500 kcal of fossil fuel to produce it, which corresponds to 2.5 gallons of oil or gasoline.Lars-Eric Bjerkehttps://www.blogger.com/profile/12632949799117185675noreply@blogger.comtag:blogger.com,1999:blog-5235419263414453422.post-92182791156525722862011-01-06T14:53:27.489-08:002011-01-06T14:53:27.489-08:00Alexander - it's quite true that there were bi...Alexander - it's quite true that there were big food price shocks in the seventies, and then food prices fell for decades. That's one big driver for why farms keep getting bigger and bigger - farmers have barely been making money, and the little ones go under or sell out to big ones with better economies of scale.Stuart Stanifordhttps://www.blogger.com/profile/07182839827506265860noreply@blogger.comtag:blogger.com,1999:blog-5235419263414453422.post-50518516777570837452011-01-06T14:35:51.121-08:002011-01-06T14:35:51.121-08:00Hi Stuart,
here is The Economist:
Malthusian mou...Hi Stuart,<br /><br />here is The Economist:<br /><br /><a href="http://www.economist.com/blogs/dailychart/2010/11/economist_food-price_index" rel="nofollow">Malthusian mouthfuls</a><br /><br />seems like food prices are actually declining ;-)Alexander Achttps://www.blogger.com/profile/16845172528191878930noreply@blogger.comtag:blogger.com,1999:blog-5235419263414453422.post-46398111589790929292011-01-06T09:01:41.929-08:002011-01-06T09:01:41.929-08:00Stuart,
Food prices and fuel- a couple of comment...Stuart,<br /><br />Food prices and fuel- a couple of comments from Europe.<br /><br />From 1, 2011 all EU countries will start selling E10, thus petrol with 10 % by volume ethanol. Germany and Finland are already well ahead. As it looks from Wikipedia, the world will use more and more ethanol, which will probably influence food prices.<br /><br /> http://en.wikipedia.org/wiki/E10_fuel<br /><br />One interesting innovation from the Finnish petrol company St1, who just bought Shell Sweden, related to you wish for a carbon neutral transport, is their sustainable bio ethanol produced locally from waste. They claim the life cycle emissions from their bio ethanol is 0.01 kgCO2/kgoe, compared to US corn ethanol 1.4 CO2/kgoe. <br /><br />http://www.st1.eu/index.php?id=2883Lars-Eric Bjerkehttps://www.blogger.com/profile/12632949799117185675noreply@blogger.comtag:blogger.com,1999:blog-5235419263414453422.post-3515838238864180612011-01-06T08:06:31.583-08:002011-01-06T08:06:31.583-08:00Apparently the price of rice is only half of what ...Apparently the price of rice is only half of what it was in 2008. <br /><br />So the Chinese have breathing space here. My guess is that biofuels squeeze the price of wheat more than the price of rice.<br /><br />Andrew Xie, former chief economist of Morgan Stanley Asia Pacific, is among those who sees the world economy as a zero-sum between the US and China. <br /><br /><i>The most likely candidates to trigger the next global crisis are the U.S.'s sovereign debt or China's inflation. When one goes down first, the other can prolong its economic cycle. China may have won the last race. To win the next one, China must tackle its inflation problem, which is ultimately a political and structural issue, in 2011. If China does, the U.S. will again be the cause for the next global crisis. China will suffer from declining exports but benefit from lower oil prices.</i><br /><br /><a href="http://english.caing.com/englishNews.jsp?id=100210360&time=2010-12-23&cl=111&page=all" rel="nofollow">here.</a>Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-5235419263414453422.post-87454943931770440652011-01-06T06:29:22.794-08:002011-01-06T06:29:22.794-08:00While it's true that the cost of the US consum...While it's true that the cost of the US consumer diet is mostly in processing, packaging, distribution and marketing, the majority of the cost of poultry, hog, steer and dairy diets are the base commodities themselves.<br /><br />The long term effect of these swings in commodity prices on the ag sector is the continued elimination of the small diversified farmer in favor of increasingly large scale monocultures - both genetic and geographic.<br /><br />We grouse about banks too big to fail but we continue betting all of our food production on fewer and fewer producers and genetic strains.<br /><br /><a href="http://www.newyorker.com/reporting/2011/01/10/110110fa_fact_peed?mbid=social_release" rel="nofollow">Banana anyone?</a><br />.Mike "Pops" Blackhttps://www.blogger.com/profile/11764915910014484680noreply@blogger.com