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Krupp: Food Speculation

08/06/12 5:55PM By Ron Krupp
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(Host) It's not easy to determine exactly how much food Vermont imports. But commentator Ron Krupp thinks that rising food prices due to drought in the Midwest is just one good reason why we ought to know.

(Krupp) In 1975, George Burrill and Jim Nolfi of the Vermont Institute of Community Involvement - published a research report on the potential for food self-sufficiency in Vermont - called, "Bread, Land and History."

At the time, they estimated that we import 95 percent of our food. It's difficult to know whether that percentage has changed since then, because no comprehensive research has been done recently on the subject of food self-sufficiency in Vermont - but I suspect that we import less today than we did in 1975. After all, the farm and food movement has grown by leaps and bounds in just the last ten years. The number of small, diversified farms, farmers' markets and Community Supported Agriculture initiatives have increased. And we buy more local food per capita than any other state. On the other hand, most people shop in supermarkets that don't carry much local food.

When I travel around the state - doing garden and farm talks at libraries, I always ask folks how much of their income they spend on food, especially local food. Most people don't know - but studies show that American families spend on average 13 percent of their income on food whereas in 1950 the figure was closer to 25 percent. I would guess that families that support local farmers and value-added producers spend more. And some families grow their own food as well as prepare and put food by for the winter.

The world's poorest two billion people spend from 50 to 70 percent of their scarce resources on food. And in some places. World grain prices doubled between June 2010 and June 2011. The United Nations reported that this increase even surpassed that of the prices during the last major food crisis in 2008 - translating into an over-all increase in food costs of 39 percent.

The "Arab spring" was not just about democracy, but also access to food. A correlation can be drawn between spikes in food prices and the January 2011 overthrow of Tunisia's autocratic government and later that year, the revolt in Egypt - the world's top importer of wheat.

The severe drought in the Midwest will increase food prices but the main reason food prices are out of control has to with the deregulation of food commodities like corn, soybeans, wheat, and sugar and the speculation that occurred when contracts to buy and sell foods were turned into derivatives that could be bought and sold among traders who had nothing to do with food. The result is a relationship between supply and demand that's distorted by what some consider to be greed. By becoming more self-reliant through farming and local food initiatives, Vermonters can reduce their dependency on food imports, affording us greater protection from speculation, and establishing a more stable, regional food economy.
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