Friday, 2 July 2010

There's been a food bubble

You probably remember back in early 2007 our TV screens were full of 3rd-worlders eating grass because food production was being converted to bio-fuel production and food prices were soaring beyond the means of the developing countries. I'm sure you felt guilty for a minute or two before channel hopping to something less gloomy.

Well, you're off the hook! It turns out that it wasn't you in your gas-guzzler starving those poor natives. It was the usual suspects, bankers, they were pulling their money out of real estate and needed somewhere else to stash it, so they bought agri-futures and in so doing pushed the price of food into the stratosphere.

Of course the laws of supply and demand cannot be bucked for ever and in 2009 food prices crashed back down again; no consolation to any African who starved to death in the mean time though.

Johann Hari in the Independent has the details.

1 comment:

Steve Ballmer said...

Interesting blog my friend