Wednesday, February 27, 2008

Food Prices

There was much talk today in the news about the worldwide wheat shortage that has caused an increase in the price of commodity wheat, resulting in a higher price on flour and therefore a higher price on all things made with flour: bread, pasta, pizza, crackers, cakes, bagels, and donuts, just to name a few. Weather was to blame for much of the worldwide shortage and further reducing supplies, US farmers replaced wheat fields with ethanol producing corn.

It is interesting to me that the hype surrounding ethanol, also largely fueled (pun intended) by the high price of gasoline, has resulted in increasing prices of food. Corn was originally commoditized and government subsidized to prevent this very thing. Corn, which before the ethanol boon had become cheap, found its way into possibly every processed food in the form of sweeteners, thickeners, fats, and fillers, creating a surplus of high calorie, convenient cheap food and an overweight population. Perhaps food that is too cheap is not a good thing either...

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