Aug 06 2008
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Food Prices - The Worst is Still Coming
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The USDA and major food companies warn food prices are about to get a lot higher. According to the U.S. Bureau of Labor Statistics, food prices rose 6.3 percent during the first five months of 2008.
Food manufacturers and wholesalers have been mostly absorbing fuel increases up to now but they say they can’t continue to do so for much longer.
The demand for corn ethanol has big corporations like Sara Lee and Kraft saying they expect to raise prices as much as 25 percent on products like macaroni and cheese, corn flakes and cookies. Basically anything that is made from corn or eats corn is going to go up dramatically over the next few years.
Fuel prices are a large factor in the price rise, but the cost of corn is pushing prices up more than anything.
Economists predict that this 25 percent increase won’t be the end. Food prices are expected to continue to climb throughout 2009.
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