Feeling the Pinch of Rising Food Costs

Student Contributor: Annie Poehling
Culinary Arts Degree Program:
A.O.S. in Culinary Arts

If you have tried to purchase a gallon of milk lately, you might have noticed that the price has been creeping up just about every time you enter the grocery store. Actually, milk prices have risen an average of 30% in the last year to $3.90 a gallon. And the gas pumps and dairy case aren’t going to be the only places that will hit you in your wallet. In the United States, the price of a dozen eggs jumped 38% last year and corn prices have risen by almost 50%. The reality is that the whole world is paying more and more for their food.

A lot of people are trying to understand what is causing the sharp rise in prices, and it essentially boils down to two things: less supply with more demand and ethanol. As the world becomes more connected and sophisticated, we all want to experience foods from everywhere, which comes at a price. The people in Shanghai and Cairo want to be able to eat American cuisine just like the folks in Chicago and San Antonio want to enjoy Indian and Moroccan foods.

Since the Great Depression and World War II, we have seen a shift of people moving from the countryside to more urban areas as larger corporate farms take over. Since there are fewer producers, we see a tighter pinch on where our food comes from, especially when natural disaster hits. For example, hurricanes in 2005 devastated Florida’s tomato crops, causing fast food restaurants to leave them off their sandwiches because tomatoes were simply too expensive. We will also probably feel the same pressure of supply and demand now that snowstorms in China have knocked out at least 10% of their food production this year.

Global warming has also taken a toll on the production of food products. Rising environmental temperatures (and the resulting natural disasters) have made it more difficult to produce food in California’s Central Valley as well as through the American Plains. Warmer winters cause some plants to bloom too soon, then the buds freeze when it does get cold again—causing lower productivity per acre. Perhaps related to global warming, there is also a shortage of water in the West and South of the U.S., causing cities to ration water due to severe droughts.

Even with all these things affecting the price of food, the single largest contributor to increased food prices is the demand for ethanol. Not only has the price for a gallon of gas made the cost of transporting food more expensive, but the demand for biofuels have made it even worse. Biofuels are made from corn and soybeans, which sounds like a good plan; however, this is the same corn and soybeans that was previously used to feed livestock around the world. The number one grain used is corn. Most of the corn in this country is used as an ingredient in another form: high fructose corn syrup. It’s hard to imagine that your favorite candy or soda is adding to the problem as well.

Many countries produce grain, which allows us to have massive surpluses around the globe. But now some countries are considering banning the exportation of their grain crops in order to feed their own livestock and biofuels production. These countries feel they also need to keep their grains to help feed their own people. Food has become so expensive that the poor in Haiti have resorted to eating dirt to satisfy their hunger and get some nutrients when they can’t afford bread or other food. The issue is not that the food isn’t available; it’s that most can’t afford it.

In this country, people are recognizing this as a huge problem. President Bush mentioned the rising prices in his State of the Union Address. He mentioned that the economy is a double-edged sword right now—wages are up but so are food and fuel prices. For the first time, a 24-ounce loaf of bread is nearly the price of a gallon of gas. Many families have to make a decision about what is more important, the bread or the gas. Sadly, some of these families are the farmers themselves. The average farmer brings home about $0.19 of every food dollar consumed; in the 1950s, it was more than $0.30 of the food dollar. Today, many farmers are being forced to turn the fields that formerly grew wheat or other foods to soybeans and corn due to high market prices and demand for biofuels.

You would think, since this is an election year, that this would be a hot topic of the debates, but most of the candidates don’t seem to want to address this problem. The candidates have merely briefly mentioned their proposals for the ethanol crunch, but noone has mentioned the rising food prices. Most suggest giving government subsidies to farmers to encourage them to grow corn and soybeans for ethanol production and to reduce crude oil dependence and create energy independence. But energy independence is wreaking havoc on grocery store prices as well as our environment. It is not necessarily any “cleaner” than oil.

Restaurants are feeling the stretch of the dollar, too. Higher gas prices have been affecting restaurant dining frequency for some time, but now some restaurants will have to raise their prices to help offset the increased cost of food. Restaurateurs will have to wait and see how much the average customer is willing to pay for a meal before they decide to pass on dining out. For now, some diners are choosing to dine at home more often, but some are still going out to eat for the more labor-intensive dishes they enjoy—such as tamales—even though the prices are increasing along with corn prices.

So, what can we do to prevent spending all our money on milk and expensive fuel? Shopping around for the best prices along with lowering fuel dependency is what many are doing to help relieve the pressure. Buying local products that don’t have added costs of shipping is another great place to start. Another option is brushing up on your gardening skills with an old-fashioned “Victory Garden.” Whatever way you choose to personally contribute, this is a global issue that we all must learn to deal with.