Blog: Food inflation - can we blame the banks for that too?
Chris Brook-Carter | 25 June 2010
It's an easy - and satisfying - exercise to blame the world's financial industry for all the economic woes we have been faced with in the last 18 months. Pay freezes, rising taxes, VAT hikes are easy to pin at their doors. But food inflation? Well there is a link, but we shouldn't be too quick to judge, apparently. I thought you would be interested in this missive, on my desk this morning, from our EU correspondent Keith Nuthall.
"It may come as a surprise to food manufacturers worldwide that the price bubble in commodities that caused such trouble in 2007 to 2008 was NOT the fault of financial speculators.
But that is the conclusion of a study released yesterday (24 June) by two academics tasked by the Organisation for Economic Cooperation & Development (OECD) to probe the boom in food ingredient prices.
Professors Scott Irwin, of the University of Illinois, and Dwight Sanders, of the University of Southern Illinois agreed that money flowing into commodity markets from 2006 to 2008 "increased substantially".
This happened, they agree, because investors decided food ingredients were in demand and so investing in commodities made sense. But according to Irwin and Sanders, the fact that these investments were made did not inflate prices in itself: "It has not increased price volatility", according to the study.
In other words, the prices would have gone up anyway - a simple matter of supply and demand. Emerging from a recession fuelled by financial speculation, food industry executives can - perhaps - be forgiven for being sceptical."
We hear a lot in the food industry about two interconnected trends: and social media and “foodie” culture....
Nestle, set to welcome a new CEO on 1 January, has announced more changes to the make-up of its senior management team....
Blue Bell Creameries is trying to win back the trust of consumers after a fatal listeriosis outbreak last year was linked to its products - but in recent days the US ice cream maker has issued another...
The UK's competition regulator has given the all-clear to Hain Celestial's bid to buy UK food and beverage group Orchard House Foods, nine months after the US group announced the deal....
- General Mills on Q1, innovation, margins
- Interview: Mondelez's outlook for China
- What next for Bernard Matthews? - comment
- Interview: Mondelez eyes sweet success in China
- Aryzta FY results, outlook for 2017 - 6 takeaways
- ConAgra acquires Frontera Foods' "gourmet" brands
- Aryzta FY profits fall
- Nestle revamps foodservice arm
- Nestle close to finalising Garoto deal
- Nestle launches Nesquik Protein Plus for adults
- The Big 15: Strategies and Priorities of Top Packaged Food Players in Comparison
- Global Chocolate Confectionery Overview: Challenges, Opportunities and Risks
- Global Foodservice Market 2016-2020
- Constellation Brands, Inc. (STZ) - Financial and Strategic SWOT Analysis Review
- Fast Food Restaurants in the US - Industry Market Research Report