- Nationally, food prices rose 3.9% in April compared with the same month in 2006, and the outlook is equally chilling wherever you shop. It is happening for many reasons: inflation, drought, freezing weather, even the rising cost of corn — highly sought after not only as ingredients for thousands of food products but also to make ethanol.
Food prices in 2007 are increasing at their highest rate in years.
"We are going to see grocery store prices show one of the most rapid increases in the last 15 years or so," said Patrick Jackman, an economist at the U.S. Bureau of Labor Statistics.
Given that I’m not an economist, agricultural or otherwise, I’m way out on a limb here, but this Means Something. For years we’ve been hearing concerns about losing farmland to sprawl and the diminishing returns of agribiz megafarms. We’ve been hearing simultaneously about peak oil and peak farmland. Now we are seeing what the economic effects of each look like. At the same time, a story like this gives, um, fuel to critics of the biofuels industry.
Prices will surely fall again once the summer gas guzzling again wanes, but we need to keep an eye on the long-term trend. In any event, it makes paying to preserve farmland look a little wiser.