Breakfast cereal prices going up 25% by Nov 15

[FarmboyBill]

Corn prices are going up due to Russias loss of that crop over there. That means bacon and steak prices going up also. That helps the grain farmers, and hurts the feedlot operators.. Ima kinda wondering if thats not how its gonna kinda be from now on. Loss of crops or turning them into gas is going to hurt feedlot operators, more cowss will be grass fed. Hogs may be as pricy as steak

[Terri]

One box of cereal MIGHT have 10 cents worth of grain in it: it is that little!

You might be right about meat prices, though: a LOT of corn goes into a pound of meat!

[jwal10]

My raisin bran has no corn in it but it will go up too I'm sure....James

[Belfrybat]

We appear to be in an "inflation/deflation" mode. Some things going up, others staying the same or going down, so the end result is pretty static. The problem for those of us who are not big consumers and pretty much purchase just food (both human and animal) and a few household products, our costs are going up.

My solution is to shop the sales. If you have an affiliated grocery near you, they run fantastic sales, at least in this area. Milk this week is 2 gallons/ $4.00. Big Lots is a good place to buy cereal also.

[rambler]

Russia had a wheat problem, which started the grain market to go up a bit in what would normally be a downward time of year.

Then the USDA kept reporting there would be super record corn & bean yields in the USA, until just a few weeks ago, when they finally agreed with farmers in the upper midwest, that the 'I' states had actually kinda poor corn crops and just good bean crops. This sudden change in outlook by the USDA scared the heck out of the markets, and they have gone up.

Asian Rim countries continue to see USA soybeans as a good buy do to the lower USA dollar value, so they continue to buy a lot of our soybeans. Which makes them more valuable, even tho we have a pretty darn good crop & supply this year overall.

There is rumor of less than ideal weather in Brazil, which would not normally be important at this time of year, but with grain prices jittery, that sort of thing gets noticed & adds to grain prices.

Hogs & dairy are typically hurt badly by high grain prices.

Cattle can use a lot of DDG - the leftovers of making ethanol - and so are not so severely hurt by high grain prices. Affected of course, but not so drasically.

Poultry is in it's own little world, so totally intigrated that it is hard to tell what effect anything has on it.

As we go through winter, grain prices will be _very_ volitle, swinging way way up if there is any weather scares in other parts of the world, or could drop quite a bit if the USDA decides to change their numbers again, or China & Russia decide to play with imports/exports. It is _very_ hard to guess this thing this year!

--->Paul

[fishhead]

There's no excuse for cereal prices to rise 25% when corn makes up so little of the cost of cereal. It's just plain gouging and the companies should be called on it.

[Nature_Lover]

Paul, thanks for your thoughtful post.
I appreciate your insight!

[Wisconsin Ann]

Prices fell again this week (2nd week in a row) as exports dropped...importing countries just going without corn from the U.S. instead of trying to pay $5.75 a bushel. It's down to something like $5.60 now.

As to other things that use corn going up...probably not. Beef...while they use corn, they are more cattle being raised for slaughter than a year ago...same with chicks. actually...

Daily average ethanol production rose to a record 881,000 barrels a day in the week ended Oct. 15 from an average of 854,000 barrels the prior four weeks, the Department of Energy said Oct. 20. The number of chicks put on feed rose 5.6 percent to 169.2 million in the week ended Oct. 16, the government said. U.S. cattle feedlots probably increased purchases 2.9 percent last month from a year earlier, a Bloomberg News survey shows.

so....while corn will cost about 20% more (at the moment) there will be more supply of the various things...(pig numbers are WAY up, too, after the spectacular year they had this year) so more supply means that they can't raise the price too much.

It all balances out as long as there isn't a world wide shortage. More from this area, less from there...cutting back on things in one country, causing surplus in another...it's a farmer's normal day.

[Forerunner]

Boxed cereal has been way overpriced and overrated for years.
What are folks on here even eating the stuff for ?
Get yourself a bushel of wheat and a bushel of hulled oat groats; crack 'em and cook 'em, as needed, for a fine and wholesome breakfast that leaves the middle man stranded a lonngg way from town.

Regarding the ethanol equation... I haven't penciled it out, but it seems to me that the full use of the by-product for feed and the fact that the protein content of that product is greatly enhanced in the distilling process would render the impact on food prices neutral at worst. The ethanol bashers never mention the super feed stock created during the process. From a completely balanced and neutral perspective, does the use of corn for ethanol really impact food prices negatively ?
Anybody have some real numbers ?

[GrannyG]

The TV News stated that Cheerios, Chex, and Wheaties would definitely be going up in price...I ususally get mine at $G and try to use coupons, so it is not too bad.....

[fishhead]

I eat millet for breakfast during the week and oatmeal on the weekends.

It's better food and much cheaper.

[Patt]

Glad we eat oatmeal or granola pretty cheap even when it is organic.

[jwal10]

I buy my raisin bran at Rite aid, $1.99. 50 cent coupon and their double off makes it 99 cents, then 2 for 1 makes it 2/99 cents. 25 1/2 ounces/box, 1/2 cup, 24 servings/box, 2-3 times a week. about 6 boxes a year. I eat a small piece of sprouted wheat bread and a Tablespoon of goat milk yogurt with it. I eat it because I need to, vitamins and minerals that I need. I am on a very strict diet, no stomach and a very short intestine. Needs to keep moving but slow enough to absorb nutrients. Whole wheat, raisins, wheat bran, sugar, salt, malt flavoring....James

[ronbre]

glad i don't use the stuff..on a low carb diet

[backachersfarm]

I agree with you Forerunner. maybe if it gets high enough folks will stop feeding that crap to their kids...and feed them more Pop tarts....lol

[ladycat]

All I know is, that up until a few months ago, I could stack deals all the time and get tons of free cereal. Mostly General Mills and Kashi, sometimes others.

But for the past few months about the cheapest I can manage is around 50¢ a box. No double coupons here; that always makes it harder.

Very frustrating when you're feeding families who go through a lot of cereal.

[rambler]

Originally Posted by Forerunner

Regarding the ethanol equation... I haven't penciled it out, but it seems to me that the full use of the by-product for feed and the fact that the protein content of that product is greatly enhanced in the distilling process would render the impact on food prices neutral at worst.

This is just my opinion, there are others here.

Ethanol takes out the starch/sugar of corn, you are left with about 17 lbs of protien & fiber out of every 56 lb bu of corn. Protien is a higher value feed ingredient, but of course sugar & starch have their place as well.

DDG works best with cattle, tho can be used in smaller amounts with other critters.

Some places haven't dried/ handled the DDGs properly and have some spoilage/ off-feed issues, but that seems to be related to how individuals are handling the product.

China is buying a lot of the stuff, instead of soybean meal, as it is a cheap feed in their eyes. It also doesn't get recored in the grain transactions, sorta under the radar for affecting soybean/ corn export prices.

I wouldn't call ethanol neutral on feed supplies. It's a lot closer than some think, tho.

Back in the 1980's, when ethanol production started more or less in my back yard by some farmers that got together with their own money.....

Corn was worthless. Couldn't afford to grow it 'here' where we grow more than we consume locally. Other countries didn't like the USA any more, didn't import from us unless they had to - do to previous USA govt policies. We were kinda close to agriculture falling apart. A lot of the goofy 'farm programs' from the govt were in the 1970's and 80's - and they weren't really helping - many focused on buying & stockpiling ever more grain in bins all over. Which lead to - grain prices falling even lower, with all that supply sitting around.....

If you grew corn in areas where it was all used locally, or right by a port so it could ship out of the USA cheaply, you'd make something. But the 'surplus' corn that sat around, was all sitting around in my back yard, far from ports, and we couldn't grow enough beef, pork, and poultry to use it all.

So, ethanol was born. It was to help with air polution, help stretch fuel supplies a bit, and return some ecconomic benifit to the local area.

In that light, ethanol made, and still makes, a lot of sense in my part of the USA. The DDGs (the 17 lbs of high-protien feed left from a bu of corn) makes good feed, and it the 'better' part of the kernals that the livestock needed anyhow.

Without ethanol, I'm not sure USA agriculture would have survived as well as it has. Certainly there would be much bigger, worse, farm support programs than their are now.

Ag was in abad way when the ethanol movement started.

USA ag is much more stable, and working on a global scale now with ethanol as part of the mix.

While most people dislike subsidies, I think we'd be in a worse deal of them without ethanol, than with ethanol.

Ethanol doesn't affect food prices very much, as it is taking the sugar & starch out of surplus corn stockpiles, returning the protien to aimal feed use. What effects grain prices more is world ecconomies. We are going to have higher than average food prices so long as the USA dollar is in decline.

Again, there are other opnions out there, this is just mine.

--->Paul

[Forerunner]

From what little I have diligently followed, and from my own limited knowledge of mechanics and the distillation process, I agree with you, Paul.
I figured you might have something more to say with a little prompting.
I think you hit the nail on the head when you mentioned one of the keys being how well the by-products were utilized. In the right area, with good and diligent management, I think ethanol and the gluten feed potential are a win/win.

[Silvercreek Farmer]

Originally Posted by Terri

One box of cereal MIGHT have 10 cents worth of grain in it: it is that little!

You might be right about meat prices, though: a LOT of corn goes into a pound of meat!

Right on! Your cereal probably has more oil in it than corn! (embodied that is!)

[nduetime]

oatmeal-eggs-yogurt-bread-fruit-lots of things to eat beyond packaged cereal. Just saying...