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Good News

After a year in which food prices rose sharply in many countries, strong harvests in Europe, Russia and the United States are helping drive prices back down, reports the (subscription required) Financial Times.  Prices for corn, wheat, soybeans and rice are all down.

For billions of people around the world the price of basic foodstuffs like these remains the most important single factor in determining whether and how much they eat. Unrest among the world’s poorest rarely affects international politics; people living on one to two dollars a day do not have time for political unrest.

But the strong harvests will be a positive factor in the Middle East, and reduced food inflation will give the Indian and Chinese governments a little more breathing room for economic stimulus efforts. The Food and Agricultural Organization says that food price inflation is falling across most of Asia.

All in all, good news.  Let’s hope that more will be coming our way in 2012.  We can use it.

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  • Jacksonian Libertarian

    There is a difference between Energy Supply created inflation, and Money Supply created inflation. While increased Food Supplies will lower food prices, so does increased Energy Supplies or at least when they stop rising Food prices stop rising as well. The CPI which everyone thinks of as the inflation measure (its not), is excessively influenced by Energy Prices. The Enviros have been blocking energy development for so long, that even during our present deflation, energy supply shortages have been causing inflation in common consumer items, like gas, food, and recently manufactured items.

  • Luke Lea

    Did I see Congress may be ending the subsidy of biofuels? That would help.

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