Excuse me, but why the rise in food product cost?
This is a question that has been haunting businesses as well as individual on the retail level for well over a year now. Since early 2010 there has been an astronomical rise in food products and it appears that no change in trend is in sight. In fact the UN’s Food and Agriculture Organization (FAO) has reported a 37% percent increase over last year for basic food products. While there has been a number of circumstances relating to the rise of food products, I still believe, my opinion, is that like gas, market speculation is probably the silent killer in this mystery. I mean, we know that that the economy worldwide had been in dire straights for several years now but when we talk about must have products such as food should the economy really be the main culprit for big bucks paid at the retail and wholesale level by suppliers, grocers, restaurants, and lastly consumers? After all, the world as a whole has been inflicted with catastrophic weather conditions such as late winters, an unreasonably hot spring and now summer, drought, and too much rain. Add war, famine, and the cost of fuel and we, in the food industry are dealing with a dangerous concoction relating to our profit margins and reasonable cost of products to our customers, which by the way, we want to keep. Let’s face it, quality food cost a little more and with the rising cost some customers leave for cheaper products. Using cheap products just isn’t good for a number of reasons. For us it would put our reputation on the line, for consumers, it will mean consuming unhealthy products. So what is the real reason the prices overall have risen to around 37% more. My opinion is that market speculation and irregularly high demand around the world from smaller yields due to abnormal climate conditions has caused the economics in the food industry to shift negatively. Tell us your thoughts.