Another News Article On Rising Prices

Business By indydebi Updated 6 Apr 2011 , 3:09pm by jason_kraft

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indydebi Posted 14 Apr 2008 , 4:06pm
post #1 of 8

I printed this article and will keep it handy to quote to clients, if needed.

I also heard on The Wall Street Report today that food prices are high and they are going to stay there. Farming costs have increased. Fertilizer is at $1200 a ton ... up from $450 a ton just one year ago. Good lord, a 300% increase!! A dairy cow costs twice as much now as one did a year or so ago.

Farm equipment is costing more because of the 'ole Supply-n-Demand law ..... China and Asia's demand for farm machinery has increased the demand, ergo increased the price of the tractors, combines, etc. As more and more countries become industrialized, the demand for equipment and gas/oil will increase .... and therefore, so will the pricing.

It didn't sound like these rising prices are just a blip on the screen ..... it's a rising line on the chart with no detours or turnarounds in sight right now.

Sharing this info with everyone so you can be informed as you talk with brides/clients who want to dispute your price.

7 replies
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indydebi Posted 14 Apr 2008 , 4:15pm
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P.S. There is also a news video on the above link with an interview with a farmer. Interesting, so be sure to watch it, too.

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ReesesCupcakes Posted 14 Apr 2008 , 4:46pm
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Thanks so much! I've explained my price increases to my customers and once I explained the corn/ethanol connections to everything, they completely understood my raising the prices.

Thanks so much for the great info!

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mommicakes Posted 14 Apr 2008 , 10:06pm
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As always Indydebi, Thank you so much for the new information. Truly appreciated. icon_smile.gif

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indydebi Posted 6 Apr 2011 , 5:08am
post #5 of 8

Another "higher food prices" article from the Wall Street Journal. As cakers contemplate raising prices, I'd suggest keeping these articles handy for those customers who complain about any increases!

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CWR41 Posted 6 Apr 2011 , 6:54am
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Originally Posted by indydebi

Fertilizer is at $1200 a ton ... up from $450 a ton just one year ago. Good lord, a 300% increase!!

I realize this thread is being revived from three years ago, but even today, fertilizer has never cost $1200 a ton. During the time that fuel costs starting rising (2008/2009), fertilizer was around $400 a ton. Now, it's $600 a ton, but it gradually got there with the cost rising 25% - 50% over several years. Fuel is used in processing/delivering fertilizer, which makes sense for the increase in price, but thank God it is nowhere near $1200 a ton today. Pre-emergent (more expensive than fertilizer), doesn't cost any more than $700 a ton!
(don't know why The Wall Street Report stated that, but felt I should point that out because it's incorrect info.)

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ilovesprinkles Posted 6 Apr 2011 , 2:48pm
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Thank you Indydebi! DH is in finance, and has been saying this for months. I'm just a newbie, but my prices are definitely going way up from where they are. This is a great resource to have on hand for customers.

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jason_kraft Posted 6 Apr 2011 , 3:09pm
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Interesting timing for the resurrection of this prices actually dropped quite a bit in 2009 and the beginning of 2010, so the increase we are seeing now brings prices back to 2008 levels.

There are definitely some weather-related supply shocks that have been driving up prices for certain ingredients as well as uncertainty around oil due to political instability in the Middle East and North Africa, but I don't see any unusual long-term trends that will cause price increases higher than typical inflation rates (usually 2-4%/year). If anything, food prices from the macro perspective have been lagging normal inflation.

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