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Continued: Nancy Barnes: Curiosity about food prices develops into a global story

  • Article by: NANCY BARNES
  • Last update: November 30, 2008 - 7:16 AM

The oddest things started happening in our food aisles and in food markets this year.

Grocery stores saw runs on rice, the most basic staple of the world's diet. Investors started pouring money into buying future crops of wheat, sending prices for a loaf of bread soaring. The price of eggs, pork and beef were also rising along with the price of grain. Around the world, stories started emerging about food shortages; some countries started erecting trade barriers to ensure they had enough food in their own countries. The words "food crisis" started being bandied about around the globe.

Here in Minnesota, home to some of the country's first wheat traders and now some of the world's largest food companies, our readers asked: Why?

Had we seen an end to cheap food as we had come to expect it? Was all this an anomaly? Did the ethanol boom (fuel vs. food) play a role? Were some individuals profiting at the expense of the American consumer who just wanted to stock his or her kitchen with bread and eggs?

To help ourselves and our readers understand this better, we invited the CEOs of General Mills, CHS, Cargill and Lunds Food Holdings to talk to us about what they were seeing and what this meant for their companies, and our readers. Then we hit the road, visiting Minnesota farmers, grocery stores, manufacturers, egg producers, and some of the plants in remote parts of the world where Cargill is working with underdeveloped countries to bring food to the world's markets. The result of that reporting starts today, with a weeklong series in print and online called "Our Hungry Planet."

Don't expect simple solutions. We discovered that the answers to our questions are, in many ways, even more complex than the questions. The world's food markets have never been so interdependent, nor have its trading markets. A development in one part of the world -- Chinese consuming more protein -- can have consequences for the price of pork in your food aisle. A runup in the price of oil affects the cost of the packaging that goes into a box of Hamburger Helper. Investors, looking for the next sure bet, start pouring money into the futures market for grains, making food just another commodity (like oil) on which to place a bet.

Any one of these events has a trickle-down effect through the entire food chain, which literally stretches from Papua New Guinea, where palm oil is produced, to your local grocery market. Add them all up and you have the recipe for what seem to be inexplicably higher prices.

"More than ever," said business editor Eric Wieffering, "the price you pay for food is beyond your control. The price you pay depends on what people in other parts of the world are doing."

Reporters who worked on this project learned a lot, and they hope our readers come away with a better understanding of how interconnected the world's food supply is, where the weaknesses in the food chain lie and how these fault lines can erupt in the future with direct consequences for your grocery bill.

"The project left me wondering if the planet can sustain all of the agriculture we'll need in the years to come," said agriculture reporter Matt McKinney, who wrote the first story in this series from Papua New Guinea. "There's a lot of doomsday scenarios out there about running out of food, and not all of them are worth listening to, but it's certainly true that the world's water and land will be put to the test in the next few decades."

At the same time, he said, he has come to a better appreciation of "the outsized role that Minnesota farmers and companies play in all of this, that we're a major player in the world's food chain, and that a lot of people around the world go to bed at night with full stomachs thanks in part to what goes on here."

I invite you to join us this week as we travel the food chain to explain what happened to food prices this year. You'll meet a Minnesota farmer who has learned to trade directly with buyers overseas, a bartender turned wheat trader who made $1 million this year, an egg producer who is reaping benefits from the reduction in the supply of eggs and a farmer in Papua New Guinea who is building a new life for his family even as questions arise about how much of the rainforest is being cleared to make room for oil palms. You will discover, as we did, that the once-quiet business of agriculture has been transformed into a complex global race for food, land and profit.

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