Thursday, January 27, 2011

US Warns of Quickly Rising Food Prices in 2011 Read more: US Warns of Quickly Rising Food Prices in 2011

Food inflation, already destabilizing emerging giants in Asia, is coming soon to the United States. The government expects rising commodity prices and energy demand for ethanol to push up food prices by between 2 percent and 3 percent in 2011, according to the U.S. Department of Agriculture's Economic Research Service.

Such a rise would be a return to normal food-price increases, according to the government.

Also, overall inflation may stay “officially” low, however, since the government regularly removes food and energy costs from its calculations.

“Although food-price inflation was relatively weak for most of 2009 and 2010, higher food-commodity and energy prices have recently exerted pressure on wholesale and retail food prices,” the USDA said in a release. (more)

“Hence, higher prices are projected to push inflation toward the historical average inflation rate of 2 to 3 percent in 2011.”

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