In November we brought you an article about the National Inflation Associations predictions for the coming year. Inflation that is a direct result of the Federal Reserves quantitative easing was predicted to have major impact on food prices by June of 2011. The idea being that people can save on housing and transportation, the 2 things that are affected most in these instances. This means that the inflation will fall to other areas where people have to spend money, and in this case that means food. As it turns out, its looking like the NIA was absolutely right. Worldwide food prices hit record highs in December and in some countries like India experienced overall inflation of more than 18% for the year.
The Food and Agricultural Organization holds an index of 55 different food commodities, and their new reports show that even though the costs of some foods like rice and corn dropped, many others increased. In some cases this was due to drought, and other weather related causes, but dont rule out inflation based on the dollar itself in the months to come.
The real problem that is bound to arise is that the obvious solution to this problem, self sufficiency, wont be as easy thanks to the new food modernization bill passed by the Senate recently. The fact that the FDA and Department of Homeland Security will now have governing access over any food production will make it that much harder for independent farms and growers to produce food to even take care of their own families needs. Combine this with the major push to use genetically modified seeds that dont reproduce the following season, and youve got a sure fire way to drown the average farm out of existence. Before long, well have no more choice in regard to where our food comes from or how much we pay for it.