Rabid Liberal Rants

Food prices continue to go up due to more demand for grains, oil prices, and population growth in developing countries. Even my local bagel store had to raise bagel prices to $0.85. Wheat prices surged on Monday this week, and demand for soyoil/soybeans has been solid. Irwin Kellner comments in Marketwatch, explaining “Why it takes a lot more bread to buy dough these days”.

On the supply side, bad weather has affected key wheat-growing areas such as Australia and South America, cutting into harvests and thus reducing inventories. Another reason for reduced wheat supplies is that many farmers have diverted their land to biofuel crops, such as corn for ethanol.