Wall Street Journal says:

Load the Pantry

Food shortage fears reach U.S.
ROB VARNON

Food limits, rationing and poor people starving in the street, those are things that happen in other countries, not America, right?

Well, at least for now, most experts say, despite a tremor of doubt and fear that briefly swept through the nation after two major bulk retailers placed limits on sales of rice this week.

That warehouse membership stores Costco and Sam's Club both imposed limits on bulk sales of certain types of rice due to supply and price concerns wouldn't normally be big news, except that the rice announcements follow recent limits placed on flour, sugar and some cooking oils.

Milford Costco General Manager Jeff Dawson said the limits can vary by region and here in Connecticut it's not capped at a single bag but for a pallet-full of 20-pound bags. He said there is a supply concern, similar to a sugar concern stores faced a few months ago when limits were set because of a refining problem. That problem cleared up, he said.

The company doesn't want to sell out of its product when there's concern it might not be able to get any more in immediately, he said, and it also doesn't want to give a single customer all the supply.

The limits are apparently tighter in California, according to a Reuters report, in which some Costco stores were only selling a single bag per customer.

Sam's Club said Wednesday it is limiting bulk sales of rice to four, 20-pound bags per customer on certain varieties. Not all stores are placing limits, BJ's Wholesale Club had no such limitation as of 4 p.m. Wednesday.

That this is happening shouldn't be a surprise.

"We live in an interdependent economy," said Rigoberto Lopez, interim director of the University of Connecticut's Department of Agriculture and Resource Economics.

Lopez said he couldn't speak to the specific issues of rice production and availability, but the world food supply is facing challenges, with the biggest of these being price.

"I believe it's the costs of production," he said, that's ultimately creating scarcity.

He was joined in this position by Terry Jones, of Shelton-based Jones Family Farms.

Both men said the industrialization of China and India has led the two countries to not only increase demand for energy to produce computers and other machinery, but also to grow and harvest crops using more farm equipment, which creates more demand for energy products, including oil.

These countries' rapid demand for energy, is driving up costs for transportation and fuel, which gets rolled into food prices, and according to Lopez, "creates its own scarcity."

As prices for certain products rise, fewer people can buy them and that creates a de facto rationing, he said.

When this happens with things like food, energy and housing, it hits everyone, but especially the poor, the professor said.

Jones, who is chairman of the Working Land Alliance in Hartford, said that besides the rise in energy usage around the globe, U.S. policies are exacerbating the problem.

He said take the federal government's ethanol policy, in which farmers are growing corn that is turned into a transportation fuel only at great energy costs that require the use of fossil or other fuels. This not only drives up demand for fossil fuel, but it also takes corn that would be used for food out of the supply chain, driving up costs for all kinds of products, including cattle feed and ultimately meat, he said.

He and Lopez said the drop in the purchasing power of the dollar is also adding to the problem.

And droughts and other weather-related problems are reducing the ability to grow crops in some areas, he said.

"Two or three years ago I would have been surprised," Jones said of major retailers placing limits on food. "In hindsight, we could've seen this coming."

Limiting food distribution is something that has, until now, mostly only been a part of the routine of those who take care of the poor.

"We have always had a system of rationing," said Nancy Carrington, executive director of the Connecticut Food Bank.

Her group distributes food supplies to charitable organizations throughout most of the state, including Fairfield and New Haven counties.

She said right now, the group has plenty of supplies, but it did have to ration coffee, distributing it among the various groups by size, because coffee is a luxury item they don't get very often.

But the real lean times, when rationing becomes important for the food pantries, are in the summer, she said.

That's traditionally when gasoline prices spike and families have less money to donate to charities.

"Last summer was the worst summer I've ever seen," Carrington said. "I'm concerned for this summer."

Gasoline prices have already topped $3.50 a gallon nationally and are approaching the $4 mark.

Jones, for his part, said it's nearly unbelievable with all the resources, that we have people in this country going hungry.

But he said perhaps things will change and wiser policies that encourage farming will finally be developed.