Wall Street Journal: Higher Food Prices to Hit Europe

The global rise in food prices is catching up with continental Europe, adding to mounting inflation worries…Rising global food demand, freakish weather and the trend to reroute crops for biofuels are pushing up food-commodity prices globally.

China Daily: Price rises take a toll in Shanghai

Inflation is touching the lives of nearly everyone in Shanghai. The price of a beef-filled snack at a store popular with office workers in the central business district has jumped from 1.5 yuan apiece to 1.7 yuan. Bottled water, found in many Shanghai homes, has risen to 17 yuan from 16 yuan just a week ago.

Domestic help has also become more expensive. Cleaner Cai Li said her hourly rate has risen by 30 percent to 10 yuan.

“I need the extra money to buy food for my family,” she said.

The average price of pork at the city’s markets has increased 25 percent to 26 yuan per kg and egg prices have averaged around 8 yuan per kg. Prices of fish and chicken have also increased 10 to 15 percent from the year before.

Hungarian Newspaper Portofolio: Food price hike revs up inflation forecasts in Hungary

New Zealand’s online business new site, Stuff.co.nz:  Food prices start to bite

Canada’s national post newspaper: Get ready for food-price spike

Soth Africa business report: Food price rises are a major factor behind the wave of strikes

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You may mistake the above commentary with a Hollywood disaster movied script, but these headlines, in fact, are real life events, all fed by google news withing a narrow window of last twelve hours.

I believe those above mentioned headlines did cover a representative section of the developed first world and bigger economies. Don’t forget the fact that, countries like those in Europe, New Zealand or Canada historically maintain huge buffer food stock and backup supply chain to prevent unexpected food price hike. That’s why we don’t see a significant variation in food price in the groceries of a developed country.

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It can be clearly presumed that the supply-demand discrepency did start quite a while ago and needed a long time to finally menifest as short supply and price hike in the markets of Germany or New Zealand. To the contrary, the market in Bangladesh barely manages and don’t have the luxury of a buffer and backup. So it can be safely assumed that the price hike that is menifested today in first world market place, would hit Bangladesh much earlier, just when the global supply demand discrepancy started. And exactly that happened in Bangladesh, price hike started early last year.

It is expected that in the first world market and bigger economies, with restoration of supply chain, initiation of backups; the price hike problem will correct itself. However in a third world economy, like that in Bangladesh, the market correction is not expected to be as quick and as automatic. The flood that destroyed millions of acres of cultivated land will further hamper the recovery process.

It is very intriguing to see how countries like China, Canada, New Zealand or EU are bracing the problem and what steps they are taking. In our case, we are still occupied with Tareq Zia theory, i.e. Tareq Zia’s corruption made the essential price so high and all pieces of evil in this planet. Our observers, analysts, experts rarely tried to dig in the real cause.

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Recently, in different blogs, I got excited at ritual Tareq bashing.  Rather focusing, exploring and analysing the problem, we try to demonize one single character behind all the vices that is happening to the country and then hope that, once that vice is gone all pain will disappear in one night and there will be continous happines. This is in fact our national trait. That’s why the nation went into sudden disbelief and confusion at the absence of drastic change after 1971. That’s why hyistorically we had the shocks of post independence famine, post Mujib chaos, post Sattar autocracy, post Ershad disappointment and post 1/11 market place inferno.
Tarek Zia has two kinds of problem. One I saw in my own eyes. Those are arrogance, stupidity, abuse of power and gross political mistakes. Other is corruption charges. For that part I am still waiting for the government show me some proof. It is impossible to believe that government won’t be able to show proof of one single corruption. Without that I simply refuse to join the corruption chorus. Whatsoever, I like to see him behind the bars for a longer time, at least for his political failure, abuse of administration for his own childlish adventures.

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Lets go back to price hike issue. China, Europe and all other are going all nine yards to find the root cause the supply demand breakdown. Europe has already identified the over enthusiastic bio-fuel cultivation behind lack of food supply. China is suggesting construction boom, diversion agriculture manpower, resources to construction, failing to expand agriculture with demand as potential causes.

We also need to go to the root of the causes. Our brighter minds can’t afford to remain obsessed with Tareq Zia. With no stock-supply buffer, high price in global market and destruction of crops by this recent flood, price of essentials is poised to take a worse course. It is extremely important we prepare ourselves for the storm that is coming our way.