This won’t make haters of THE BER-NANK happy, but Paul Krugman does nail the main culprit for soaring food prices.
It’s weather and bad harvests.
Based on the latest USDA data, he produces this chart showing the decline in global wheat production. “FSU” is the Former Soviet Union.
Photo: Paul Krugman, NYT
As the last bar notes, a lot of this has to do with the former Soviet Union. But when you consider drought in the US and China, and floods in Australia and Brazil, it’s easy to put it all together.