The Agflation Storm Is About To Strike
By: Tom Chatham – Author of The American Dream Lost
Corn and soybeans contribute to almost everything we eat and the sudden rise in the price of these items will filter down into price increases of just about everything. Corn prices are expected to get as high as $12.50 per bushel and soybeans could go to $20.00 or higher. Some commodity specialists have even suggested that soybeans could be the new silver.
Corn and soybean meal are staples in animal feed and the rising prices and drought conditions are forcing farmers and ranchers to sell off their herds for slaughter. This will cause a glut in the market over the short term and you may see lower meat prices as a result but this will only be temporary. By next year the prices of meat will rise as the supply of livestock reaches multi decade lows. Supply and demand will push prices higher as a result.
Larry Pope, chief executive of Smithfield Foods has recently given a dire warning. “Beef is simply going to be too expensive to eat. Pork is not going to be too far behind. Chicken is catching up fast.” He also stated that government regulations are going to make things even worse. Almost 40% of the U.S corn crop goes to make ethanol fuel. Pope said, “Its almost a government- mandated disaster here, which is distressing”. He warned that meat prices will rise by “significant double digits“.
It is good to be optimistic and hopeful but those feelings need to be tempered with some reality. Prices are going to go much higher in the future and for those that are already living near the edge of food insecurity, it is only smart to plan ahead and store up some food items you know you will need in the future. If you buy now and eat it later when the price is higher, that is the same as making interest on your investment and that interest is immediate and non taxable.
If you have the means to store away some extra meat products it will be worth your time and money. If you plan to keep this extra in the freezer you need to have a backup power supply for it that will last at least several days so that any power disruptions will not cause the loss of your food. For those that are considering buying a freezer to store meats in, I strongly suggest you look at propane freezers as an option. They are more expensive but will continue to operate even when the power is out and unlike using a backup power supply, you don’t need to be there to insure power is maintained. If power should go out while you are away, the propane unit will continue to operate as normal, preserving your supplies.
As stated in earlier articles, the benefit of having a propane supply will enable you to power generators, stoves and heating units as well as the refrigeration unit. A large propane tank or two can enable you to go without power from the grid for weeks or months with the proper equipment so it is definitely something to think about. For those that cannot afford to go this route it might be more economical to buy some canning equipment and can some meat from the store as the price drops in the near future. This will provide you with the meat supply you need without having to worry about refrigeration.
It is in this type of environment that you should consider having a few acres of land and some livestock to help provide for your family. Having a garden, a small flock of chickens, some geese and ducks, a breeding pair of hogs and a small field of corn to provide feed for them would go a long way to offsetting the high price of food that we are inevitably going to see on a recurring basis in the future.
One of the dangers in the near future is the fact that over 48 million people in this country depend on food assistance payments from the government. As the price of food goes up, it is unlikely that those payments will keep up with the food cost and families will find themselves getting fewer groceries every week until they find they can no longer buy enough food to prevent starvation. Even those with a weekly paycheck may soon find themselves in dire straits when confronted with higher prices. In an extreme circumstance, where food supplies are very tight, certain foods may not be available at any price.
For those that do not already have a well stocked pantry, I implore you to begin buying food staples now while you can. Even if you only have $5.00 per week to put toward staples like flour, cornmeal, beans, rice, pasta, canned vegetables and powdered milk, over the course of several weeks you can build up a supply that will act as a buffer when prices finally overtake your buying power. The warning sirens have sounded. Those that fail to heed the warnings will have no one to blame in the future but themselves.