A partner with Polar Pork warns higher crude oil prices will result in higher agricultural input costs, particularly for feed, driving up food inflation.
The cost of feed typically accounts for about two thirds of the cost of producing a hog.
Florian Possberg, a partner with Polar Pork, says grain prices have been quite affordable the past couple of years but that could change as the result of higher fertilizer costs.
We’ve had great crops on average north and south of the border which has kept our feed costs low compared to what they were a couple of years ago. But we’re hearing already that grain producers are looking at much higher fertilizer prices because of the oil price spikes that we’re seeing. If that affects fertilizer costs, if there’s a lot less fertilizer and the weather is not as favorable as it has been for the last couple of years, we could very well see a significant price hike in our feed grains.
Of course we spend a lot on fuel, not just on our farms but moving our animals to market and from the market place to the grocery store. Higher crude oil prices will probably affect our inflation on food just because it costs more to transport it.
~ Florian Possberg, Polar Pork
Possberg says we don’t like to see food inflation affect the average family. He says it would be nice if meat prices were lower in the grocery stores but farmers have really don’t have any control over that.
