August 14, 2007 (LPAC)--The U.S. retail price of a gallon of milk has increased more than 15 percent in just six months (from $3.29 in January to $3.80 a gal in July), and some dairy products by 50%. In France, milk prices are rising by 5-10%. Germany, the European Union's biggest milk producer, saw the price for 250 grams of butter (just over a half-pound) rise two weeks ago from EU0.79 to EU1.19, while fresh white cheese prices rose 40%!
The milk hyperinflation is indicative of the food market basket at large, from grain products, to meats, sweets and everything else. The rate of food inflation in the U.S. for the first half of 2007, exceeds all of 2006. A rise of 8% in U.S. consumer food costs this year, is projected by the Bureau of Labor Statistics, which notoriously undercounts. World relief agencies are slashing food aid because their funds can't buy enough of suddenly expensive supplies. At a conference in Manila last week on world poverty, the threat of starvation was discussed.
Why the hyperinflation?
The controlled global media are pumping out a two-part, uniform line: 1) China is gobbling up all the food--both in volume, and in consuming new types of goodies--e.g. yogurt and dairy products; and 2) the ethanol craze is gobbling up all the corn. Whereas, the "blame China" line is malarkey, biofuels is a blame-worthy culprit, but not the whole story. The following are a few additional features:
* World grain stocks have been declining for years, even before the grain-for-ethanol binge. Stocks of rice are at their lowest level since the 1970s. Under GATT/WTO tenets, nations were ordered to end their grain reserve policies, and rely on "world markets."
* Dairy farmers have been driven out of business in mass numbers in many countries, by high input costs, and low prices for their raw milk. In France, which still has 3.8 million dairy cattle, run by 100,000 farmers, about 5,000 dairymen a year are quitting farming to seek a less hard, better-paid livelihood. Instead, near slave-labor factory milk farms have been set up in select zones around the world, e.g. Haiti, the state of Idaho, and elsewhere, for 'global sourcing' of food.
On March 12th, Senator Patrick Leahy (D--Vermont) held hearings to promote a safety net for U.S. dairymen, noting that dairy farms will not be able to survive unless they can receive a fair price for the milk they produce. He referred to ever-increasing fuel costs, and high feed costs, driving farmers out of business.
* ADM, Cargill, Bunge, Kraft, and a few other food mega-processors are posting record profits. Besides biofuels rip-offs, this comes from gouging. The price the farmer gets out of the consumer's dollar is next to nothing. A loaf of bread that retails for $2.00 has 6 cents of wheat. Whereas a U.S. dairy farmer once got 60-70 percent of the consumer milk bill, now it's below 33 percent and falling.
* Bad weather, on top of marginalized agriculture, means shortages. This year's drought in Australia caused a drop of 1 billion liters of milk, less than expected. Of 620 billion liters of milk produced in the world, only 7% are exported, and price increases have been spectacular: in the past year, the price of milk powder has increased by 80%, and industrial butter by 50%.
