Cereal for $7 a box? Why Cheerios could be rich kids' food

cereal aisle at new seasonsMy family struggled financially growing up, and I remember the rare occasion of breakfasting on toaster pastries (when there was a great sale) and mourning how they were rich kids' food. The next day, it was back to Cheerios or pancakes with imitation maple syrup. But this week, news that wheat prices are rising fast could mean that Cheerios and Wheaties and Raisin Bran could show steep increases in price; as much as $7 a box, and higher. They could soon be rich kids' food, too.

You'll recognize the conversation from oil, whose per-barrel cost is pushing $90. Wheat has topped $10 a bushel due to dry weather in Argentina bringing concerns about a global shortage; it's already doubled this year and seems to be climbing a steep price curve. Economists are actually saying breakfast cereal could get so much as twice as expensive as it is today -- and don't think that eating Corn Flakes will save you. With many farmers producing corn and soybeans for biofuels, those crops are getting pricey, too.

My answer to rising food prices is always something like, Buy generic!Shop at Trader Joe's! But the prices are rising in concert throughout the grocery outlets, from wholesale club stores to brand name to seriously off-label. My advice? Start thinking oatmeal for breakfast, and buy local; while you may not save much in sticker price you'll save in fossil fuels for transport and you'll be helping protect our future.

Here are a few places you'll see price increases in your supermarket:
Grocery prices going up, going up, going up...
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Cereal for $7 a box? Why Cheerios could be rich kids' food
It's not just the products with wheat, but nearly all your groceries that will feel the pressure from rising wheat and soybean prices.
Hops are one of the most amazing fruits in the world; they grow extremely fast and you can turn them into delicious beer! What could be better? Unfortunately, a 300% increase in the price of hops has beer growing more expensive; it's only up 4% as of mid-May 2008, but more increases are expected.
Most commercial cattle is fed (unnaturally, as it turns out) corn. When grains get more expensive, hamburger will trail right along after it.
Most commercial brands of bread are made with soybean oil, making them doubling impacted by the rising prices of wheat and soybeans.
Cereal will respond quickly to increases in prices to wheat, corn and soybeans.
I reviewed Cynthia Hillson's self-published book, 'How to Feed Your Family', and one of the strategies mentioned is to forego spendy breakfast cereals (their prices are going through the roof!) and instead eat homemade oatmeal and pancakes.
Pizza is made of all kinds of ingredients whose price is going up; notably, the food is very reliant on the cost of wheat. How much does YOUR pizza cost?
With the cost of wheat going up, it may make sense to start making pizza from scratch (and it's healthier, too!)
Barilla pasta, long sold at Trader Joe's for 69 cents a bag, has gone up to 79 cents a pound; and if wheat prices keep rising, it will soon be a dollar per pound.
Chickens are fed some combination of soybeans, corn and wheat in most commercial farms. As those get pricier, so will eggs.
Though bulk foods are obviously hit by price increases, too, they're a great way to keep from spending on the things that don't really matter; packaging, for one; marketing, for another.
The first and most obvious hit to grocery costs from rising wheat prices: wheat flour. Buying from local companies like this Bob's Red Mill brand, though, may be the way to go.
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