Check out upcoming earnings and what they might say about food costs.
Food inflation is one of many factors putting pressure on U.S. consumers. (Housing, the credit crunch and soaring gasoline prices are some of the others.) But so far, big packaged food companies have been sticking to the mantra that consumers are willing to pay a little more for their wares as long as perceive they are getting a benefit in return.
Next week promises to offer snapshots on how rising food costs may be affecting consumer behavior. That’s because both Kraft, the largest North American food company, and Kellogg, the largest cereal maker, are slated to report earnings.
Kraft gave reporters a preview this week of new products they are launching, and none seemed to be geared to consumers trying to cut back on spending.
But grocery store operators seem to know that many consumers are scrambling to pay for necessities like food these days. Both Kroger and Supervalu are offering bonuses for consumers who turn their tax rebate checks onto gift cards to be used in the store. (Those rebate checks also are expected to start coming next week.)
So the question is, are things different this time around? Will the rising cost of fuel and food and an economy that might be in recession cause consumers to trade down to store brands and other cheaper alternatives?
Also in the basket:
Rising food prices are “global crisis”: U.N. chief
Charming Shoppes exploring alternatives on non-core assets
Protest-hit Carrefour cancels China sales plan
Plastic bottle scare is a boon for some (N.Y. Times)
(Photo: Reuters)
Trackback
2 comments so far
There is a rice shortage in the MIddleeast and Asia and South Asia and South East Asia - We in North America buy rice from places like Thailand where rice exports are being curbed. China and India have huge number of mouths to feed, not to mention the snow storm that hit parts of China. Hungry Haitians have forced their President to quit. Even China which traditionally have been heavy handed with dissidents has freed a onganizer of rice protesters. The Phillippino Americans have even taken to sending rice back to their families back in the Phillipines. And don’t forget Africa where genocidal wars are fought because of drought.
Why it the rice shortage has not hit America I’m not sure, perhaps its because we still have a decent sized inventory of the product. Or maybe in America we supplement rice with other grains such as wheat and America has much land for bread basket.
Worldwide rising food costs are kind of like worldwide inflation of food prices. All curriencies don’t stretch as far relative to the price of food.
The first step is for governments to zone land for agriculture. Capacity (nutritional survival) is the key - by filling everybody’s
It may not get any better for years. I can’t quite see how we the richer nations can afford to support the (hungry fellow human beings - where the food crisis are most impact - people straving).
We need to:
1. Plant all the corn/rice/wheat/potatoes as we can.
(The ladder to sustainability: Water, food, shelter and education/jobs).
2. Unfortunately we in order to save lives we need to help the hungry eat for a period of time until they are able to work and pay for their food again. The problem is who do you sell or give the food to (criteria - sell to those who can pay the highest price - capitalism versus give food to the most in need).
3. To produce such huge crops to feed the world Canada (of which our competitors for farming is Australia - had a drought and forest fires) has escaped any really serious calamities. Canada should plough all the land available. For example the pine beetle dead forest, could be ploughed over and corn grown. It would be foolish to count out Australia though as they are perhaps the most industrious people I have ever seen.
I like corn because you have two of the hottest markets 1. bio fuels - clean and becoming more affordable relative to petroleum; 2. food for the hungry…
YOU HEARD IT HERE FIRST
Perhaps there will be a balance eventually between a thrid world’s countries’ prices for crops and the rural people willing to work the farms (who may see their labour costs close the gap with factory workers who work near and outside citiy hubs). Is thia communism or captalism…in defense of capitalism resources are being allocated to farmers now that their products are high in demand and can demand a high price.
If the price is high enough economic migrants may even leave the factories and go back to working the land.
This is assuming there is clean air and water and labour without modern machinery is worth it.
It is an idealistic compromise.
I have an alternate solution, some of these big developing nations with large lands and cheap labour (perhaps in the future with modern machinery as well)…WHOSE LAND SOIL AND AIR are polluted could grow bio-crops (since a little pollution in fuel may not be as harmful as injestion) eg. into ethanol and then sell; either the dried corn kernels and or ethanol delivered in super tankers to developed countries, and then these developing nations could use the profit they make to buy unpolluted food.
On my personal front I am humbly giving up my working income since last week (at least 80% per day) and to the end of this week (inspired by Ghandi) - to donate to our fellow citizens of the World - who aren’t able to meet their basic need for survival.
- Posted by Gerard VoonSome people may call me hypocrytical, but I’m trying contribute on my part.
God Bless
Another thanks to “Al Gore and his lackies” thats not a rock group. It represents a bunch of Marxist and Environmentalists which are set on destroying our planets economic base with this unsientific Globle Warming Crap. His push for alternative fules has caused the price of gas and food to go up world wide.
Wake up to this beast 666 he is stupid and in this thing for his own profit. He should take his own Carbof footprine and place it in the approperate place.
- Posted by Tucson Don