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What is MDEF™ Investing? Strategy before tactics. Strategic investments dictate tactical actions in the Metals, Defense, Energy & Food sectors.

- Jeffrey C. Borneman

Food Inflation Unceasing - Investors Take Note

Jeffrey C. Borneman | August 20, 2014

“The food index rose 0.4 percent in July, its fifth increase at least that large in the last 6 months," (emphasis mine) reports the BLS. On June 17 of this year I said: "Most articles I've seen on Inflation dismiss previous Food price hikes ...  repeat the line that Food Inflation does not exist; that Inflation is low, too low, according to the NYTs ... ".

The seasonally-adjusted price index for meats, poultry, fish, and eggs also hit an all-time high in July, according to BLS.

What's the line from that Don McLean's song? " ... perhaps they'll listen now"? 

"The average price for all types of ground beef per pound hit its all-time high -- $3.884 per pound -- in the United States in July ... A year ago, in July 2013, the average price for a pound of ground beef was $3.459 per pound. Since then, the average price for a pound of ground beef has gone up 42.1 cents--or about 12 percent."

I can hear the NYT's now saying 12 percent is "nothing" and "we eat too much red meat as it is." Think this through: "Five years ago, in July 2009, the average price for a pound of ground beef was $2.147, according to the BLS. In those five years, the average price has climbed by $1.737 per pound--or almost 81 percent."

Eighty One percent Inflation in beef does take a major protein source out of reach for many struggling Americans. What do investors do with this information?  Discussed recently (here) is an ever-growing (pardon the pun) expectation of both acquisition and consolidation of Food companies. 

If you want to know more about how the MDEF™ Investing strategy is positioned in this, or other geopolitical possibilities, please contact us directly.

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