Monday, May 23, 2011

One shock away

An article in today's Washington Post discusses China's influence on food markets. As Chinese demand for food shifts out and supply remains relatively constant, prices go up, as with the 25% of US soy that the Chinese now consume. World Bank President Richard Zoellick now says that we're one shock away from a serious crisis. Hopefully some of the pressure will be relieved by a decreased emphasis in the US on corn ethanol, but I'm not holding my breath.

Bonus reference in the article to "gelatinized donkey skin." Mmmm.

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