Strong customer desire at times help in fighting any downward spiraling of demand in the face of rising prices. The demand for Italian pizzas and pasta has not fallen despite the rising price of wheat and cheese in the country of its origin. Undaunted by the rising prices of the pizzas and pastas, the Italians have not reduced their penchant for the good food. According to Gustavo Piga, an economics professor at University of Tor Vergata, Rome, the Italians prefer to starve and die than go without their pasta.
However, the French are not going the Italian way. Rise of dairy products is cutting down the volume of cheese from the plates of the French. Skyrocketing price of cheese and dairy products has been blamed to the European Union’s quota on milk production that has driven tens of thousands of dairy farmers out of business.
Global food inflation is not bad news for every country. Growing import demand from China and India is helping South American farmers make large profits. Soybean exports are increasing profits of soybean cultivators in not only Argentina and Brazil but also Paraguay, Uruguay and underdeveloped Bolivia are expanding soy cultivation. Meat exports are fuelling profits of beef-producing companies of Argentina and Brazil. Demand for salmon from Europe, USA and Asia has made the coastal salmon farms of Chile a multi-million dollar industry.
The fixed domestic demand and rising import demands have not reduced the profit of food industries in certain countries – after all no man can survive without food and some are snobbish enough not to exclude the exclusive items from the menu.
Source:Los Angeles Times
