Leaders from Brazil, Russia, India, China and South Africa have warned that volatile commodity prices are posing a serious risk to economic recovery.
Inflation – particularly food and energy prices – has been rising faster since the Japanese disaster and the conflict in Libya. Every business, and family, is going to be touched by these rising prices either now or in the near future.
These five nations are the top emerging economic powers in the world and they are known as the BRICS nations (taken from the first letter of their names). Together they represent more than 40 per cent of the world’s population. In a joint statement the five nations said the international community needed to work together to increase production capacity of commodities in general, not just food.
Yesterday we told you that the 50% increase in the cost of cod liver oil means that we are going to stop selling our own-brand Pegasus Health Cod Liver Oil for Horses – though we can point you towards alternatives like Linseed and Rapeseed oils.
Last year saw huge rises in the price of garlic. China is a major producer of garlic which as well as being a popular food is also used in many health supplements for people and horses.
In 2008, garlic prices in China were lower than usual which led to growers cutting back on the amount of land they devoted to the crop – and they switched to other products. With less garlic around the following year – demand boomed when it began to be claimed that garlic could provide protection against swine flu. This supply and demand situation led to prices rising – a situation that continued in 2010 and which we now see filtering through to the prices of products and supplements made using garlic.
Rising production costs – because of the increasing costs of energy and packaging – have also led to a rise in the cost of products like soya oil and linseed oil.