I have read again that speculators are partially responsible for the energy cost spike and I would not be surprised to learn that food is also being used that way.
That aside, the article mentions people not being able to buy food and the difference they see between them and the "rich". You mean people get upset by that? A shock, I tell you, a shock it is to hear that.
But we, in this country, don't have to be concerned about that with our people - do we?
Last edited by Atypical; 02-14-2011 at 07:09 PM.
Gerald Celente predicts food riots as well.
Noticeably absent in the article is any discussion of the influence of US Monetary Policy on rising food prices.
Food Costs Elevate Chinese Inflation
By THE ASSOCIATED PRESS
Published: February 14, 2011
BEIJING (AP) — A jump in food prices pushed China's inflation higher in January, adding to pressure on Beijing to control surging living costs.
Consumer prices rose 4.9 percent, driven by a 10.3 percent rise in food costs, government data showed. That was a rebound from December's 4.6 percent rate and close to November's 28-month high of 5.1 percent.
Beijing has hiked interest rates repeatedly to cool rapid economic growth and inflation pressures. But analysts say inflation is being driven by tight food supplies at a time of soaring demand — a problem the government cannot quickly fix.
Private sector analysts expect more interest rate increases this year but say such moves alone cannot bring down inflation. Many expect inflation to go even higher before peaking later this year.
Part of an article in NY Times by Stephanie Clifford, Motoko Rich, and William Neuman. Feb. 14, 2011
The sharp rise in commodity prices since last year has not translated into all new records. Food commodity prices are about 8 percent below the high in the summer of 2008, while energy prices are less than half their zenith. Prices of a basket of other commodities are about 4 percent below the heights of mid-2008.
The cost of raw materials accounts for a small portion of the cost of most consumer goods, as labor, processing and packaging tend to make up a larger share of the price at the cash register. Foods like coffee, meat and milk, which are closer to raw materials, will probably show some of the biggest price jumps.
Companies that try to pass on all their costs could meet resistance. Although consumer spending has risen, unemployment remains at 9 percent, and average hourly earnings are up less than 2 percent over the last year.
“These companies are constantly walking a tightrope on how far do I go,” said Jack Russo, a consumer goods analyst at Edward Jones. “Do I offset with price or other cost cuts, or do I just take it and have it eat into my profit margins?”
Already, rising raw material costs have cut into corporate profits. Kimberly-Clark, which makes Kleenex tissues and Huggies diapers, said fiber- and oil-based products had contributed to a small dip last quarter. Procter & Gamble said earnings fell slightly in the division that makes Crest toothpaste, as well as in its household brands unit, which makes Tide and Cascade.
Plenty of companies are indicating they will push up retail prices. Kraft, the largest United States food manufacturer with brands like Oscar Mayer, Velveeta and Ritz crackers, said it would raise prices on many products this year without saying which ones or how much.
Soaring prices for coffee have pushed up costs at the coffee shop. Starbucks said last fall that it would raise some prices. Sara Lee, which sells Hillshire Farms meat and Senseo coffee, said that it would, too, on many items.
Restaurants, which resisted raising prices to keep customers coming through the doors last year, are also fretting. They may take other steps too, like lowering thermostats, shrinking packaging or reducing portion sizes to minimize the sticker shock.
Meat prices have surged because of the cost of feed, a decision by farmers to raise fewer cattle and pigs, and strong demand worldwide as living standards rise. An epidemic of foot-and-mouth disease that devastated South Korean hog farms has led to a recent surge in orders for American pork.
This year, “you’re going to have to raise prices to stay in business,” said Len M. Steiner, owner of the Steiner Consulting Group, which works with restaurant companies on ingredient purchasing.
Whirlpool says consumers can expect to pay 8 to 10 percent more for its products starting April 1. Apparel companies like Polo Ralph Lauren and Brooks Brothers said they would raise prices this year. Hanes Brands, which has already done so, said prices on cotton-heavy products would rise again at the end of summer. If cotton costs stay high, Hanes products could have a cumulative 30 percent increase.
Some companies don’t think they can get away with charging more. PepsiCo, which makes soft drinks and snacks, like Fritos, said it would be cautious.
Victoria’s Secret is nudging prices ever so slightly, with panties rising from five for $25 to five for $25.50.
John D. Morris, an analyst with BMO Capital Markets, said retailers would probably try to manage costs in myriad ways.
Prices rose significantly in the apparel sector from 1972 to 1974, driven by labor costs and commodity prices, he said.
“The retailers went on to have a pretty good year in ’73,” Mr. Morris said. “Sales were up, gross margins were flat, and profit margins were up a little bit. Retailers found a way.”
A version of this article appeared in print on February 15, 2011, on page A1 of the New York edition.
Companies Warn That Higher Prices Are Looming
By STEPHANIE CLIFFORD, MOTOKO RICH and WILLIAM NEUMAN
Published: February 14, 2011
A package of Oscar Mayer cold cuts. A pair of Nine West boots. A Whirlpool washing machine.
By the fall, people will most likely be paying more for each of them, as rising prices hit most consumer goods, say retailers, food companies and manufacturers of consumer products.
Cotton prices are near their highest level in more than a decade, after adjusting for inflation, and leather and polyester costs are jumping as well. Copper recently hit its highest level in about 40 years, and iron ore, used for steel, is fetching extremely high prices. Prices for corn, sugar, wheat, beef, pork and coffee are soaring. Labor overseas is becoming more expensive, meanwhile, and so are the utility bills to keep a factory running........
Check out the full article right HERE http://www.nytimes.com/2011/02/15/bu...er=rss&emc=rss
Now that's how you do it Lloyd!!!
Thanks for the assist, though I think I did IT pretty well. Lol
Peter Schiff and now Gerald Celente? I didnt know you were a conspiracy theorist. I'm starting to wonder
about you S&L. )
P.S. I think i am going to save that Celente piece for the future. I have a feeling you might regret putting
that forward. Please tell me your not in agreement with some of the extreme things he has to say?
Last edited by Havakasha; 02-15-2011 at 02:03 PM.
I believe in nothing!!!
Celente called for food riots just as Rubini did. They have that in common. If you watched the clip, Celente cites the growth of income inequality as a reason for the riots. I thought you'd agree with that.
For someone who believes in "nothing" (of course thats absolute nonsense) you sure do put forth very specific points of view all of the time.
I am talking about some of the crazier claims of Celente. "Celente predicts revolution, food riots, tax rebellions by 2012 in America" This has much in common with Peter Schiff talking about the stock market tanking around Jan. 31st, hyperinflation soon in U.S.etc. I dont appreciate snake oil salesman trying to sell their newsletters through outlandish claims. Its irresponsible and you should know better than to push these guys on people.
Just my humble opinion.