Is Global Food Crisis on the Way?

With the drought in the Midwestern portion of the United States continuing to devastate the crops in the region, it has brought out the global alarmists who are using the situation to focus on the growing population needs through 2050, when the people on earth are expected to number over 9 billion.

One of the latest to throw his hat into the food crisis ring is Jeremy Grantham, who is the co-founder of the management firm GMO.

Grantham said this about the "food crisis": It “will threaten poor countries with increased malnutrition and starvation and even collapse. Resource squabbles and waves of food-induced migration will threaten global stability and global growth.”

CNBC reported the reasons Grantham believes there will be a food shortage, including "a spike in demand for food from an increasing global middle class, decreasing grain productivity, a tainted water supply, increasing fertilizer and fuel costs and climate change."

Of course this already skews Grantham's model, as there are no man-made climate change problems, as has been proven by the lies and distortions by so-called scientists who have used faulty models and locations to measure temperatures. Most notably are those temperatures measured in urban areas where temperatures are known to be higher than their rural counterparts because of more roads and buildings, among other things, that attract more heat.

As far as the other things, they are accurate, although I'm not sure what he's referring to specifically with the tainted water assertion. This could also be an unproven assumption based upon theories rather than reliable data.

But as far as the world being able to handle the population growth, it isn't a problem of being able to do it, as the boost in crop and animal production has risen exponentially for years. The major problem is corruption in the poor countries where the political entities are extracting what production there is from their people, or forbidding the free market system and entrepreneurs from doing their business without hindrances. This, more than anything, is the real crisis that is being faced. And until that is taken care of, we won't see the alleged food crisis solved.

Having said all that, the food crisis, whatever the cause, will result in higher prices, as will growing demand for raw materials.

Investors do need to look at agriculture over the long term, as they will with other resource sectors which will without a doubt soar in prices over the next couple of decades at least.

The commodity bull market is far from over, although it has taken a brief rest during the economic crisis.

Corn Prices Could Push Up cost of Baking, Snack Items

After doing a little research on the plethora of items that could very well be going up in price soon because of the rise in the price of corn because of the devastating drought in the Midwest, it's surprising how many of these we use on an everyday basis, and how it may affect us all going forward.

For example, prices of regular thing we use in baking and cooking, or snacks we may partake in on a daily basis could be surging in price soon.

Some of the cooking and baking items include all sorts of condiments, vinegar, jellies, corn oil, margarine, sauces and nonstick cooking spray, to name just a few.

For snack foods, things like chips, pretzels, gum, candy and cookies could easily rise in price as the year goes on.

The reason is because corn byproducts are used as either preservatives or thickening agents for snacks or cooking and baking items. It is also used for sweetening up certain products, which is why gum and candy, or even canned fruits may cost significantly more in 2012.

Rising Corn Prices Could Push Up cost of Animal Products

Concerns over the affect of the drought on food prices has many people concerned, with the immediate effect probably showing up in the boost in price of animal products.

According to the USDA, animal products projected to rise in price include pork, butter, eggs and cheese.

Other prices also almost sure to rise are beef, poultry, fish raised by farmers, milk, sour cream, yogurt, cream cheese and ice cream, to name a few.

All of these have significant corn inputs which are costing more because of the devastated crop.

Jim Rogers on Corn, Inflation, Supply an Demand

Billionaire investor and commodity expert Jim Rogers has been touting the inevitable rise in commodities in general, and agricultural commodities in particular, for some time, especially concerning the price of corn.

While monetary policies of the Federal Reserve are a disaster and have played a large part in the rise in commodity prices, it's not the entire story, says Rogers.

He points to the simple fact of supply and demand for corn and other commodities as a major factor in the price increase, and it isn't solely a dollar/inflation scenario moving corn prices.

Growing middle classes in China and India are the major impetus behind soaring corn and commodity prices, and having a growing amount of disposable income, along with the desire for better food, is a big part of the rise in food prices, even though a large part of that is from the misguided policies of the Federal Reserve and other central banks, who continue to debase currencies.