The NY Post says that New Yorkers are getting soaked at the grocery store over the price of cereal:
“I definitely see an increase in [the price of] cereal,” said Rochelle Neumann, a paralegal who was shopping at a Gramercy Park-area Gristedes. “You used to see it on special every week.
“Now, never. It went from $1.99 on special to two for $7. That’s a major increase.”
We have talked about the increase in the cost of food before on All American Blogger. The culprit in this case is the usual suspect: ethanol.
One reason breakfast is on the rise is because ethanol-fuel production is using up a large chunk of the corn crop, experts said.
And that is affecting everything from cereal – which has officially seen a 2 percent increase this year – to the feed for the livestock that become bacon, said Ephraim Leibtag, an economist with the U.S. Department of Agriculture.
The Post, using the latest data from the Bureau of Labor Statistics, has calculated that a consumer purchasing several common breakfast items could have spent up to 12 percent more last May, than a year earlier.
Another unintended consequence. And the price increase isn’t just in America. Here are a few links showing problems elsewhere:
- Ethanol Demand Threatens Food Prices
- FUEL OR FOOD?
- The fight for the world’s food
- Rising corn prices hit grocery shoppers’ pocketbooks
As the technology increases, perhaps the ethanol producers can switch to other sources, but with the powerful farm lobby, I would expect that that would be difficult.
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