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1008 PD: On the Edge of Common Sense: High price of wheat

Baxter Black Published on 30 June 2008

The record-high price of the essential global commodities – wheat, rice and soybeans – has been an overdue and much welcome occurrence for farmers worldwide.

Commodities that have lagged so far behind the inflation curve, it’s too embarrassing to discuss.

So, to modern farmers in the U.S. and Canada, it is a long sweet drink of catchin’ up. And to hard-working small-acreage grain farmers in Thailand and Vietnam, the high prices have actually lifted them, even temporarily, from the grinding, life-shortening poverty of subsistence farming.



In the U.S., where food only takes an average of 7 percent of a consumer’s income, the rise in the price of food is less noticeable. Rarely does it push families to the brink of malnutrition. But in pockets of 3rd world poverty, where they can’t feed themselves, such as the Philippines, Afghanistan, West Africa, or Bolivia, the high price of grain can be devastating. If, for instance, it takes 50% of your income to cover your basic food needs, imagine what would happen if food costs tripled. Complicating the issue is that there is no shortage of grain. As one American expert says, it’s that it is often in the wrong place and priced too high for the poorest to afford.

In the 1970’s the big global issue was overpopulation and massive starvation. Now in 2008, we see that the free world, led by America’s farmers, is able to produce enough food for us all. Thanks to the Dows, Monsantos, universities, John Deeres and winter in-the-shop inventors, we met the challenge. In addition, charitable world food aid programs, once again led by America, try to reach the poor with manna, ton after ton, time after time.

We cannot wish the price of grain were cheaper, unless, of course, you’re a cattle feeder. But one man’s prosperity is another man’s problem. Socialism or Communism decrees that the winner subsidize the loser. Unfortunately, they themselves are rarely very productive. The world has come to rely on the great American entrepreneurial ethic to pack the freight. And our Christian compassion stimulates our unending generosity.

Back in the 70’s, India, Russia and Vietnam could not feed themselves. Today they are grain exporters. The free world taught them how. It looks like we’re not done. PD