11/25/08 Holiday Gas Price & Food Prices

Holiday Gas Price & Food Prices plus Food Forethought. I'm Greg Martin with today's Northwest Report. Over the river and through the woods will not be as expensive this Thanksgiving as was originally feared. The average price of gasoline in the northwest has dropped some .85 cents in the past month and a whopping $2.30 since July. Some gas stations are reporting prices in the $2.00 range with the national average at $1.91. A little over a week ago, I paid $1.75 at a gas station in Kansas City. We may also see less in the way of price hikes for food in the coming year according to USDA Economist, Ephraim Leibtag. LEIBTAG: I think that given where commodities are right now that we are going to see a lot lower inflation for the categories that really shot up so the biggest contrasts will be the ones that really were big movers in 2008 such as eggs, cereal and bakery products and fats and oils. Those were the three that increased the most in 2008 and we have much lower inflation forecast for those in 2009. In terms of other categories the real big question mark is in terms of meat products where there wasn't too much inflation for most of this year and prior to the recent crashed commodity markets we thought those prices would really show up in 2009 and now it's kind of an open question whether we're going to see as much of that inflation given how far commodity prices have fallen. Now with today's Food Forethought, here's Lacy Gray. It is a known fact that mankind suffers from the "ostrich syndrome". We have the innate tendency to stick our heads in the sand and pretend if we don't see it or acknowledge it, it doesn't really exist, and therefore won't hurt us. Hard fact is that the longer we stick our heads in the sand in regards to the fuel shortage, the more it will hurt us and future generations. The starts and stops that have procured in the last couple of decades with research programs designed to find a replacement for the world's fossil fuel use have been abundant. One such program involved the possibility of using algae as an oil replacement. The U.S. Government abandoned its research into algae based fuel in 1996 because they didn't feel they could reasonably compete with the price of petroleum. But with the price of oil fluctuating dramatically, and the worry over world food supply competition from the production of ethanol, the interest in algae oil production is once again coming to the forefront. And with algae oil being homegrown and plentiful, will it be the world's future? We don't know, but the need for a fossil fuel replacement is glaringly apparent and the cost for not finding and implementing a replacement is eminently disastrous. Thanks Lacy. That's today's Northwest Report. I'm Greg Martin on the Northwest Ag Information Network.