We've seen that food prices, especially staples such as corn, wheat and rice, have been skyrocketing to records the last couple years. We've seen that these rising prices have already started causing food riots across the world as seen in ApacheTrout's diary. Wheat has gotten so expensive, it's now more cost effective for Afghani farmers to raise it rather than opium poppies for heroin.
Well, buckle up folks, you haven't seen the last of the price rises, scarcity, famines and riots.
There are several trends that are occurring now and will continue that will bring the end to cheap and plentiful food. Follow me under the fold and lets delineate some of these trends, after which I will help you buckle up for the wild ride ahead.
BillyZoom has a good discussion of Krugman's take on this too. Food prices are arising.
PAYING MORE FOR FOOD: the trends against us.
Food will be cheap no more. The Western world, and increasingly some of the rest, has lived in an decades-long era of cheap and abundant food. Yet since 2005 food prices have been rising and now the Economist's food-price index is the highest it's been since 1845:
ONE of the odder features of last weekend's vote in Venezuela was that staple foods were in short supply. Something similar happened in Russia before its parliamentary election. Governments in both oil-rich countries had imposed controls on food prices, with the usual consequences. Such controls have been surprisingly widespread—a knee-jerk response to one of the most remarkable changes that food markets, indeed any markets, have seen for years: the end of cheap food.
DECREASED SUPPLY: Global Warming
Climate change is and will continue to have nefarious effects on our global food supply. Persistent droughts in previously productive areas have and will continue to lower food production, floods are destroying crops and rising temperatures are hurting our ability to grow cropswhere we've been growing them for centuries. The current change in climate will not allow much time to adjust without some major pain.
Climate change is cutting into our food supply.
Additionally, in our attempts to fix the problem, we're shifting to using crops for fuel (there was good dk diary for this a while back, can't find it, anyone have a link?). This has caused (and will continue to cause) more land to be used for fuel instead of food, decreasing the food (and beer) supply further. NPR just had a segment on this stating that the cost of filling a 25 gallon tank would feed a person for a year.
INCREASED DEMAND: Population Growth and the rising middle class
So, while the downward pressures on our food supply increase, the demand for food is increasing. The population is now over 6 billion. Though we have been able to lower our global birthrate, the population still marches forward. It is estimated to reach 9 billion by 2050. We are struggling to meet the needs of 6 billion, 50% additional mouths to feed will be that much more difficult.
In addition to the growing numbers of people on this Earth, more of those people are demanding more food and foods which require more land and oil resources:
Homi Kharas, a researcher at the Brookings Institution, estimates that by 2020 the world’s middle class will grow to include a staggering 52 percent of the global population, up from 30 percent now. The middle class will almost double in the poor countries where sustained economic growth is lifting people above the poverty line fast. For example, by 2025, China will have the world’s largest middle class, while India’s will be 10 times larger than it is today.
Of course this is a great thing. Bringing people out of poverty is great. But it will increase the demand on food:
The new consumers of the emerging global middle class are driving up food prices everywhere. The food-price index compiled by The Economist since 1845 is now at an all-time high; it increased 30 percent in 2007 alone.
The more middle class people there are, the more demand for meat (which uses more land and food resources) and other high-quality/high-needs foodstuffs.
So, demand on food rises, supply decreases. That in and of itself is a simple economic formula for dramatically rising prices.
Oh, but that ain't all folks... to the increased demand and decreased supply, lets make it worse by making it cost more to produce (decreasing supply further)...
INCREASED PRODUCTION COST: Peak Oil
Experts in the industry predict that peak oil has either already happened or will in our lifetimes, earlier rather than later (A Siegel has a good diary from last year, and there are many others). Simply put, the era of increasing production and availability of cheap energy is at an end. Prices, already at record historical highs, will only keep rising as demand rises for oil while the supply remains stagnant at best.
What does this mean for food? A hell of a lot.
As the above linked article says, it takes a lot of oil to make our food:
The U.S. food system uses over 10 quadrillion Btu (10,551 quadrillion Joules) of energy each year, as much as France’s total annual energy consumption. Growing food accounts for only one fifth of this. The other four fifths is used to move, process, package, sell, and store food after it leaves the farm. Some 28 percent of energy used in agriculture goes to fertilizer manufacturing, 7 percent goes to irrigation, and 34 percent is consumed as diesel and gasoline by farm vehicles used to plant, till, and harvest crops. The rest goes to pesticide production, grain drying, and facility operations.
It's a one-two punch. The first right jab are fertilizers and pesticides, two of the legs of the green revolution that allowed us to increase our population from 3 to 6 billion in my lifetime. These are made by, with and through oil. The more oil costs, the more these cost, the more food costs.
The left jab is transportation. Cheap oil meant I could easily buy produce grown in Chile. Cheap transportation costs allowed Chile (or insert other far flung location) to grow produce cheaper than my locality and then ship it cheaply.
No more. The cost of transporting food is and will continue to increase. Hawaii is a canary our family is familiar with. The effect of oil's price rise has already acutely been felt in Hawaii. Even though Hawaii theoretically could feed itself, tourists and most residents still buy food that has been produced far afield. As transportation costs go up, Hawaii feels it deeply. We live in Hawaii in the summers (believe it or not, it's cheaper for us) and have noticed food going up in price there at a greater rate (hey, pays to buy local there!).
There you have it folks, in a nut shell: The decreasing supply of food meets the increasing demand for food and the increasing cost of producing and transporting that food. Food prices have no where to go but up. Of course, as a commodity, prices will be quite volatile, going up and down in large and smalls swings, but in the larger picture of things, it will go up. Quickly.
There are solutions to this crisis (yes, it will be a crisis). Drastically reducing our energy consumption while quickly changing to well-thought-out alternative energy sources. Rezoning. Contraception. I'm enough of an optimist to believe that when faced with disaster, we can pull away from the brink. We humans have a lot of ingenuity. I'm enough of a pessimist sometimes to wonder if we'll do it all in time.
I'll leave these global solutions for another time and for a better and more informed diarist.
PAYING LESS FOR FOOD: Bucking the trends.
I might not be an expert on global solutions, but I have become quite the authority on food. I am the shopper, cook and server for a family of 4 (5 sometimes when my brother lives with us). I have made it a life goal to feed my family cheaply with healthy food in a sustainable manner. Not a simple task, but definitely doable.
So, while the world attempts to come to some solutions, let me give you and your family some solutions to the rising costs. Because whatever global solutions we come up with, the price of food (and scarcity) will only increase for the foreseeable future and you and yours will need short and medium-term solutions in order to keep your costs down while feeding your family a healthy meal.
The 5 Steps for Saving Money on Food, or "What my 100 moms taught me."
Before we begin, let me tell you a story. 5 years ago I realized our family's monthly food bill, after moving to San Francisco, was over 1,000/month!! Sticker shock.
I belonged to (and still do) an online 'parenting' community of about 100-200 active parents. It's a community of 'alternatives.' Parents who want to 'positive parent' or home school or live sustainably or breastfeed or whatever isn't 'mainstream'. Ostensively this community is for both dads and moms, but as it turns out, there are 100+ moms and 1 papa, me. These moms live in places as diverse as Norway and Japan (though most are in the US) and range in the socio-economic scale from near-poverty to quite well-off (though most are middleclass). I've learned a lot from these moms.
So, I asked them what they did to lower their food bill. The lessons I learned 5 years ago and since helped us lower our food by by nearly 70% over the years. I will be forever indebted to "my moms." I now spend about an average of around 400/month to feed 4-5 people and the food is healthy and more often than not organic. One month, as an experiment, I got that bill down to 200 (including the cost of food I had at hand). (btw, this includes the cost of eating out). So, I'm passing that wisdom on to you...
STEP ONE: PLAN
Meal planning is the foundation of all other cost savings strategies. You've heard it said, you've made excuses for not doing it, you've done it half-heartedly.
Planning your meals a week or two or a month ahead makes for tremendous savings in many ways.
"My Moms" said this was THE ONE step you could take to lower the bill. The first month I did this, our food bill went down to 600/month... without doing ANYTHING else.
How does it save money?
- You are much less likely to buy 'convenience' meals or processed food (always more expensive) on those "what do I make tonight?" days. Prepackaged, processed and convenience foods are the death knell of the food budget. Planning allows you to make meals quickly AND cheaply, there is no need for those packaged foods.
- You can buy in bulk more often than not, which is.. more often than not.. cheaper. Check the unit price, but usually buying in bulk is much cheaper per unit than buying in small quantities.
- You can take advantage of sales and seasonal surpluses. (see below)
Planning isn't that difficult. You can do it like I do, with an database of recipes I've collected over 5 years (that's a link to the Mac software I use, Windows software example here) and more and a program that spits out a shopping list. I plan 20 meals ahead and shopping trips (one monthly for shelf-stable items, and smaller weekly walking trips for perishable items). You can do it like I do with detailed analysis of nutritional value and types of food.
Or you can just sit down for 30 minutes and write down 10 suppers and 5 breakfasts you like (we repeat breakfasts more), write out the ingredients and go shopping (I usually make enough suppers for leftovers for lunch).
I spend about an hour every other week planning, but you could do it in 15 if you just do it the quick way. Either way it's worth the time in savings, in bushels. But you don't have time you say? Wrong answer :D. Planning doesn't just save money, it saves time. The hour I spend planning every week probably saves about 3-4 hours a week in food preparation, extra shopping trips and more.
You get other bonuses with meal plans.. save money, save time, healthier meals, less waste.
Check out the Just do it link above for some tips or here for a sample plan. Also, want to really save money, try these meal plans from HillBilly Housewife to feed a family of 4 for $45/week (emergency plan) or this one for $70/week (lowcost plan). These aren't the most healthy, but can do in a pinch.
STEP TWO: A Pantry:
You can't do this if you don't meal plan. Well, you could, but it'd probably cost money in unused, spoiled or forgotten food, not save money. Once you've planned your meals for a couple months, you start to get the idea of what foods you eat a lot, which ones you can buy in bulk in advance and what to store. Once you do this, set up a pantry.
We have a 100 day supply in our home. This takes two closets and a freezer. Our 100 day supply habit is historical. We are both former Mormons with that food storage streak instilled in us and my parents, worrying about bird flu, earthquakes and other disasters decided they wanted each of their 7 (4 hers, 3 his) to be prepared, so they helped finance that storage.
But you don't need to do 100 day supply. You could stick with 30 days. It doesn't take up as much space as you think. If you have a good freezer and a closet, you can do it (the link above about Mormon food storage has lots of good information and links, including a calculator, Mormons are really good at this). At minimum you should have a 72 hour kit for emergencies, but this is about saving money, so try for a 30 day supply.
How does it save money?
- Take advantage of seasonal surpluses and sales. An example: Last week whole wheat pasta went on sale at the local market, reduced to half price! Since I plan our meals and we have a 100-day pantry, I was able to buy 20lbs of it (knowing that's about what we eat in 100 days) and store it up. If I hadn't had a plan or storage, and wanted to make spaghetti, I would probably had to have bought it at normal price.
- Helps keep from doing last-minute shopping (which often is more expensive because you buy more than you need and processed or pre-made foods). An Example: Because of some business travel I had not been able to do my meal plan for the next couple weeks. I came home with nothing planned for supper that day. I took out one of my 'pantry recipes' and made a great lentil chili all from pantry food (see the 'tip jar' for the recipe).
- Helps with allowing you to buy in bulk even more than just planning. See reason 1.
These first two steps are essential. These are the two things you can do that will lower the cost of your food by the largest amount AND at ALSO SAVE YOU TIME. The next steps are good for saving money and to a large extent rely on the the first two steps to really work. For the biggest bang for you buck and time, do the first two steps. After you have those mastered, go to the next. I'll tell you step 3 right now, we'll get to the others in a later diary.
STEP THREE: Buy seasonally, buy locally.
Again, though this can save you money without it, the real savings come when you start meal planning and a pantry first. You can plan your menus with seasonal foods in mind and stock up on those foods in your pantry (freezer or preserving.. see next diary).
Buying seasonally makes financial sense more often than not. An example: Here in San Francisco, strawberries cost about $4/lb in December, asparagus almost 5 a pound and tomatoes 2 dollars. In March asparagus can be had for a buck a pound, in May strawberries are less than a dollar a pound and in July tomatoes are nearly free.
Plan your meals to take advantage of seasonal surpluses. (don't eat asparagus in December.. though see caveat in next step in the next diary). You'll save money and be healthier for it and the food will be fresher.
What's not to like?
In the next diary I will explain some of the other steps (there's probably more than 5 though) including preserving food by canning, fermenting and drying (there've been some DK diaries on this), raising your own food, coupon cutting, avoiding high cost foods, smart shopping, etc.
Why start with these particular three steps?
These three steps will save you the most money for the effort, all things being equal, and have the added benefit of increasing the nutritional value of your diet AND save you time. It's a no-brainer. What can one argue about when something brings increased savings, available time and health?
But there is another reason I've started with these three steps. It's because by living these three steps will not only help solve the problem of the rising cost of food for you and your family, but will contribute to the global solution. It's a small contribution to be sure, but a contribution:
1. Less driving. If you drive to shop, meal planning and storage will take less driving trips than previously, cutting down on transportation. Before our meal planning and pantry, I would make 1-2 trips to the store a week, now it's about every two weeks (I can walk or take the streetcar for produce).
2. Less packaging. Buying in bulk and storage, buying less processed food, means a large reduction in packaging, and thus a large reduction in the energy costs to produce that packaging. San Francisco recycles and we've been very good to recycle our paper, plastic, metal and glass, yet we have reduced the amount of unrecyclable garbage AND recyclable trash drastically, to the point that our non-recycled garbage needs taking out to the bins every three days or so...for a family of 4.
3. Less Shipping. Buying seasonally and locally reduces the amount of oil necessary to transport food long distances.
4. Less Waste. Meal planning creates less food waste, reducing the demand on food and thus helping keep costs down.
So, why not follow the three steps? save money, save time, save health and save the world.
Visit next Monday for more tips and links.
While we are at it, anyone want to share DK authors and diaries that deal with food issues such as rising costs, food preparation, helping others, etc. There is a wealth here!
Any Vegetables of Mass Destruction diary.
gjohnsit's "Global Food Crisis Hits Home"
OrangeCloud's "10% of Ohio is on foodstamps"
Survival Sunday has a food issue for preparation. Slight different angle, but great stuff.
ONE LAST PLEA
THe rising food costs will effect us, but it will effect the poorest first and badly. So with all that money you save by planning, storing and buying seasonally, perhaps a little help for others. So those links are very useful:
article about food banks struggling, it might cost more for many of us, there are many more who are going hungry.
Action Against Hunger
and a myriad others.