Cost of Food, Take Two

By Miryam Ehrlich Williamson

Another report on the sharp increase on food commodity prices – mainly grains and grain oils – has surfaced, this one from the USDA’s Economic Research Service. This one, entitled “Global Agricultural Supply and Demand” adds several reasons to the list provided by the three Purdue University economists whose report was issued last week by Food Foundation, and discussed below under the title “What’s Driving Food Prices?”

Writing for InfoFarm, the National Agricultural Library’s blog, maleonard says,

Both reports agree: The rise in food prices results from a complex interplay of factors. The Farm Foundation report points to three high-level forces driving the price increases:

  • global changes in production and consumption of key commodities,
  • the depreciation of the dollar, and
  • growth in the production of biofuels.

The ERS report also includes these three factors, while adding on a few more, including rising energy costs, increases in agricultural costs of production, and even bad weather. Of course, the economists from both research teams provide the charts, graphs and numbers to support these conclusions, though, interestingly, neither report tries to divvy up the responsibility for the price spikes among the contributing factors. (Those wielding agendas rarely show such restraint.)

If this subject matters to you, and it surely must, you’d do well to read both reports. I’m usually wary of government-issued reports, especially from the USDA, and most especially from the current administration, with its abysmal track record for intellectual integrity. But I’ll break with tradition for once, and recommend this USDA report.

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One Response to “Cost of Food, Take Two”

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