Welcome to The Pauley Principle!

The Pauli Principle, named for Wolfgang Pauli, deals with atoms and electron-sharing that results in new, stronger bonds. Think 2 parts hydrogen and 1 part oxygen, a shared delectable (!) electron and VOILA! Water!

Similarly, when you prepare whole food to share with family and friends, especially foods you've grown, something amazing happens. Meals become tastier and healthier. Your soul, not just your stomach, becomes fulfilled. You live life more abundantly as a result. During a shared meal, the bonds that people create grow stronger and become something new: GREATER than the sum of the parts! I give you The Pauley Principle.

Saturday, April 2, 2011

The Great Corn Challenge and the Rising Cost of Getting By

We are in dramatically historic times. Corn is joining the equation to shape the future numbers of haves vs. have-nots. You already know Americans have recently experienced a huge income or wealth gap. It's getting larger. We'll look at one BIG problem, corn futures, and then look for solutions.

Just this week Michael Sabo of Lind-Woldock, an investment firm, urges people to invest in corn futures. Why? Because a bushel of corn on the futures market is now $6 a bushel. Unheard of, unfathomable, just two years ago, and rising daily as much as the trade law allows! Why corn? Its usable protein! While the futures investment may be great for wealthy investors, it's gloom and doom for the consumer.

If you think that, with corn futures so high, farmers are putting more seeds in the ground this spring, hold onto your hat. They're actually planting 8% less corn according to the April 28 USDA crop progress report. Why less? For a 200 bu/acre corn production, it takes about 200 lb of nitrogen, the leading source being ammonia, a petroleum product. Get the picture? As gas prices rise, so does the cost of fertilizer. The farmer is hit by two rising costs right now and government subsidies may be cut as the U.S. legislature looks at where to save money.

How does all this affect consumer prices? Think of second grade social studies lessons on how things are made. Now look at corn. This simple high-protein plant is an important link in the production of anything that is made from or with corn syrup and corn oil. The list is L-O-N-G!! Corn also feeds livestock; beef, pork and even chicken will rise in price. Dairy products may also be sharply affected next fall when school food programs are back in session. And corn is a player in fuel production.

Solutions? Although I continue encouraging self-reliance with gardening, self-reliance and living well goes beyond growing corn in your garden. Since meat prices will also be rising, and I believe Americans will see historically high jumps in prices, you might consider shopping ahead for things related to corn. Also, consider the diets of cultures in which corn products and beef are not often used. Often these people are healthier than Americans. Think Meditteranean. As for me and my family, we're going to raise two different breeds of chickens on the farm, one for egg-production and one for meat. In chickens, we're considering quality over price. I never thought I'd be excited about chickens but now I am. I truly am! We can make this fun!

Prices will rise rapidly and sharply. In an earlier blog, I mentioned the price hike we will soon see in fresh produce due to recent cold spells in California and Mexico. We will also soon see the effects of corn futures that are at an all-time and historic jump. Think about your own situation. Enjoy the challenges rather than becoming a victim of the market. Don't panic. Make it fun. Come up with solutions that will work for you. What are they?

1 comment:

  1. On the current open market, the cost of buying one bushel of shelled corn had jumped to $7.23 by late Friday, April 1. That's more than double what it was two years ago. That's why, for investors, corn has become a pot of gold. They can buy it cheaper on the futures market then sell high and never actually look at a grain of corn.