Wheat prices Increases are Another Less Talked About Blow to an Economy in Disarray

In economics/money, food/drink on March 16, 2008 by Editor Z

Discuss the economy with any American these days and one is likely to hear a litany of errors that provide anxieties. High gas prices, oil that is now $111 a barrel, the sapping of the U.S dollar’s strength, and the mortgage and credit disaster. However there are other areas not explored as much that are just as economically perilous and as burdensome in both the long and short term.

The increased cost of living and amongst other things the rise in food prices. It states that the price of wheat has tripled in less then a years time and many other analysts potend further disaster on the horizon.

Here is an article from the associated press that I linked to through

The wheat market has been pushed higher by a combination of agricultural, financial, and energy issues.

Poor wheat harvests in Australia and parts of Europe and the U.S have caused China and other Asian countries to buy up more American crops, which are especially attractive because of the weak U.S dollar.

At the same time, the American crop is shrinking because federal incentives to grow corn for ethanol. And skyrocketing gas prices make it costlier to get any wheat to market. Those same pressures have also made it more expensive to supply feed grains to livestock.

This cost in one central area of the agriculture sector of the economy is not purely confined to say the increase in wheat prices as stated above.

On the point of the affect of wheat prices on livestock, this will also likely lead to an increase in the price of such staples as milk, eggs, and maybe even certain kinds of meat.

I work at Atkins Farm, a small grocery store and apple orchard that sells many products from local farms. I have noticed a half dozen eggs that once cost around $1.99, now cost as much as $2.79.


Update: Correction, above I stated that the price of wheat had tripled in less than a year. Actually in the article which this is based upon, it is said that the the price of wheat had more then tripled in a period of ten months.


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