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  • From: "Tradingpost" <tradingpost@lobo.net>
  • To: livingontheland@lists.ibiblio.org
  • Subject: [Livingontheland] "Get Ready For Higher Food Prices" Goes Mainstream
  • Date: Sun, 13 Feb 2011 12:47:19 -0700


"Get Ready For Higher Food Prices" Goes Mainstream
by Tyler Durden on 02/10/2011 09:45 -0500
http://www.zerohedge.com/article/get-ready-higher-food-prices-goes-mainstream?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+zerohedge%2Ffeed+%28zero+hedge+-+on+a+long+enough+timeline%2C+the+survival+rate+for+everyone+drops+to+zero%29

While nothing new to Zero Hedge readers, the realization that everyone's
purchasing power is about to be yanked from underneath them has gone
mainstream. Omaha.com has just come out with a headline that leaves little to
the imagination: "Get ready for higher food prices." ...So for those who wish
to stock up on staples in advance of a price surge (thereby bringing the
price jump forward), and still haven't done so, here is the "mainstream"
explanation for why now is a very good time to start doing so.

>From Omaha.com

Shoppers could see higher grocery bills as early as three months from
now, though most of the impact won't be felt for another six months, said
Scott Irwin, an agricultural economics professor at the University of
Illinois.

Chicken prices are among the first to rise because the bird's life span
is so short that higher feed costs get factored in quickly, he said. Price
hikes for hogs take about a year and cattle two years. Prices on packaged
foods take six or seven months to rise.

Tyson Foods, the nation's biggest meat company, said chicken, beef and
pork prices are expect to rise this year, if only slightly, as producers seek
to cover costs.

ConAgra Foods Inc. — the Omaha-based producer of brands including Healthy
Choice, Banquet and Chef Boyardee — is raising prices on some of its products
because of higher costs for corn and fuel, said Teresa Paulsen, a spokeswoman.

The price rally has bolstered the financial fitness of America's crop and
livestock operators over the past eight months. Midwestern cropland is
yielding record values. Rural banks and equipment makers report record
profits.

“We're seeing record income levels for the ag community and ... wealth
accumulation that cannot be denied,” said Bruce Johnson, an agricultural
economist at the University of Nebraska-Lincoln. “We've moved into a whole
new level.”

Said Bruce Babcock, an agricultural economist at Iowa State University:
“Farmers are going to be earning quite a bit more money.”

Jason Henderson, Omaha branch executive for the Federal Reserve Bank of
Kansas City, said farmers are buying more tractors, pickup trucks, grain bins
and land.

“And they also come to Omaha to shop and go to events,” he said.

But it hasn't been simply a spending spree, Henderson said. Farmers are
paying down debt and fewer are seeking loan renewals or extensions.

“It's a good time to be an ag banker,” said Brian Esch, president of
McCook National Bank in southwest Nebraska. “But I have concerns over what
this means for consumers. If one guy is selling at a record profit, someone
is buying at a record level.”

The only benefit: very soon farmers, least they produce something, will be
making more than bankers. Which of course means that Wall Street will
promptly vacate the skyscrapered corridors of the financial district and
start pushing bales of straw for a living. Just as Marc Rogers has been
predicting for over a year now.

The agricultural economies of Nebraska and Iowa will continue to grow
into greater prominence as global food providers, economists said.

Johnson said rising population numbers globally and greater demand in
major developing countries for higher-protein diets have strengthened the
Midlands' agricultural market.

Farm cash receipts — led by corn and other crops — doubled in Nebraska
from 2000 through 2010. Crop receipts alone ended the decade in the $9
billion range, up from a 2000 total of $3 billion.

Will Ben Bernanke's disastrous monetary policy be the greatest thing to
happen to America's labor reallocation since Blythe Masters discovered CDS?






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