Tortilla Facts

Wall Street Journal, 1/29/07, page A16 (SUBSCRIPTION REQUIRED TO ACCESS LINK) ^ | 1/29/07 | MARY ANASTASIA O'GRADY

[Winged Hussar]

It's not the higher cost of corn per se that has Mr. Calderón denouncing "speculators" and "hoarders." Rather, it's what rising corn prices are doing to push up the cost of tortillas -- the most fundamental of Mexican staples.

...The sharp increase in Mexican corn prices, which fueled the tortilla price spike, followed big price increases for corn on international markets over the past year. The main cause, according to most commodity analysts, was the U.S. decision to subsidize ethanol made from corn. Growers who previously marketed their harvests to food and livestock companies suddenly have new demand from ethanol producers, who are also armed with a subsidy to make their bids more attractive. The increase in demand from government-subsidized ethanol producers pushed up prices.

[Winged Hussar]

Starving Mexicans can thank left-wing Kyotoist Democrats like Albert Gore and their Republican In Name Only (RhINO) allies for politically-correct incentives to burn corn (as ethanol, a rather inefficient fuel) that would normally have been eaten by the poorest elements of Mexican society. Someone ought to ask Gore & Co. what driving up food prices (a regressive tax on the poor) has to do with the Democratic Party's own stated values.

http://www.stentorian.com/kyoto/ for more on how the Kyoto Treaty and greenhouse gas regulations are a SCAM and a FRAUD that are actually designed to enrich corporations (see the Climate Action Partnership) at the expense of working Americans. We must use "at the expense of working Americans" in conjunction with "leftist so-called Democrats like Al Gore" to demolish the MoveOn.org wing of the Democratic Party, thus making sure Hillary Clinton never hears "God Save the Queen," excuse me, "Hail to the Chief," played for her.

Greenhouse Gas Regulations as Aztec Human Sacrifices to Control the Weather and Ensure Good Harvests Add "poor Mexicans" to the description of the sacrificial victim.

[Jedi Master Pikachu]

ping.

[mtbopfuyn]

Throw a handful of corn kernels out behind the outhouse and they'll soon have more than enough corn to grind for some nice fresh homemade tortillas for FREE.

[Brilliant]

Well, the Mexicans have a lot of oil. The price of corn would not be going up but for the fact that the price of oil is going up.

[NVDave]

Bingo.

And recent reports out of Mexico show that their state-controlled oil production is starting to fall off.

[Extremely Extreme Extremist]

With their abundant natural resources and favorable climate, Mexico can't grow corn on its own?

[Clemenza]

I would suggest using biodiesel (made from soy beans) as an alternative, but then the Chinese would get upset.

Expect to see more flour tortillas from the street vendors in Mexican small towns.

[Jedi Master Pikachu]

Supposedly because of NAFTA, it had become cheaper to buy American corn made on huge farms with modern technology rather than buy Mexican corn produced on small, family farms. So Mexican farms went out of business (and many of the farmers/farmhands illegally went to the United States) and now there is a shortage of corn in Mexico--ostensibly because of the increase in American ethanol production.

[KevinDavis]

I prefer flour tortillas anyway....

[linn37]

Tortilla fact,corn is better!

[linn37]

Tortilla fact,corn is better!

[UnklGene]

[television is just wrong]

brits, look at corn as cattle feed and won't touch it.

[Jedi Master Pikachu]

But they'll eat marmite?

[television is just wrong]

I know, Someone gave me a jar of the stuff. ICK. full of Vitamins and minerals though.

[chalkfarmer]

I prefer pupusas.....from El Salvador.

[Ben Ficklin]

NAFTA, Corn. and Mexico's Agricultural Trade Liberalization

[Las Vegas Ron]

Tortilla fact,corn is better!

Hand made authentic tortillas are the best. Not those crappy thin ones that are in the stores.

If you are interested, email me and I'll tell you where you can purchase them. If you really like tortillas, you will flip over these.

[Winged Hussar]

You just drove up my cholesterol 50 or so units. :^)

On the other hand, put soy cheese on those tortillas (made with oils with no trans-fat) and I'll eat the whole thing. Remember, Native Americans (including Aztecs) practically invented this grain. Now it's a shame that their descendents can't afford to buy it thanks to the Gorons (same as morons, led by Albert Gore) and other Kyotoists.

Re: "KevinDavis: brits, look at corn as cattle feed and won't touch it."

In Britain, "corn" is actually wheat, and "maize" is what we call corn. There is a line in "A Christmas Carol" in which merchants are discussing the price of corn, and an uninformed American reader will wonder what that yellow grain is doing in Britain. It's actually wheat.

[bmwcyle]

That's gas alright.

[CrazyIvan]

Tortilla fact,corn is better!

Hand made authentic tortillas are the best. Not those crappy thin ones that are in the stores.

If you are interested, email me and I'll tell you where you can purchase them. If you really like tortillas, you will flip over these.

About 15 years ago we raised some special high lysine corn on our farms because there was a premium on it. I had some ground into meal and it made some of the best cornbread I've ever had. Never tried tortillas made from it. Haven't seen the stuff for years now.

[Jedi Master Pikachu]

Yep. In the Bible, the references to corn, are actually to Old World grains (either wheat or barley).

[Las Vegas Ron]

When I first introduced my girl friend to hand made tortillas, I told her that old Mexican ladies would sit down, lean against the wall and slap the tortillas between their thighs to make them LOL! She actually believed me. True story

[ApplegateRanch]

Reporters can't even do simple math.

The sharp increase in Mexican corn prices, which fueled the tortilla price spike, followed big price increases for corn on international markets over the past year.

Fifty six cents/bushel increase in corn prices equals ONE PENNY per POUND, OR 2.2 cents per KG of corn.

Corn needed to rise BY $4.50/bushel, rather than TO $4.50/bushel to raise corn prices by 8 CENTS per pound, or 18 CENTS per KG; yet tortilla prices were jumping by as much as 50 cents per pound, or $1.10/KG.

All else being equal...and it pretty much is...the price of tortillas should be barely up, rather than "sky-rocketing".

[Eric in the Ozarks]

Mexicans like the free market for oil but not corn.

[El Gato]

The production of ethanol from corn produces high protein animal feed byproducts. Those by products have somewhat replaced the use of ground corn in animal feeds, freeing up that corn to be used in human food products. Not that human food products have been a large part of the market for corn anyway, most of the crop has historically been fed to animals.

[El Gato]

In Britain, "corn" is actually wheat, and "maize" is what we call corn.

I'm sure that's true, but I doubt that the Brits think wheat is cattle feed and won't touch it. Even the Brits eat bread. I'm sure it's maize that they think is cattle feed. Incidently, they are correct, cattle and other animals eat way more corn than us humans, but since we are omnivores we can and in most places where the stuff grows, do eat it too... either directly (sweet corn mostly) or as corn meal in corn bread, corn tortillas, etc..

[StJacques]

It cannot be denied that the rise in corn prices brought on by increased investment in ethanol and biofuels is associated with the problems of corn, and by extension "tortilla," prices in Mexico.

And though this has an extensible relationship to the Kyoto Protocols -- which I very much oppose -- I think it really has more to do with NAFTA, which has united the U.S. and Mexico into a market in which price fluctuations cross borders all too easily.

I also do not have the immediately negative reaction to this news that so many others have shown. Has anyone thought to ask in what shape Mexican corn farmers -- there are millions of them -- will be in a market environment of rising prices for the principal commodity they produce? Or what the impetus of the Mexican government will be when facing high prices due to scarcity of corn? (Hint: if you didn't grow enough ...) How about the development of larger shelf inventories in stores in Mexico, and of course through every wholesale operation which ships to them, as the high demand for corn drives investment decisions to satisfy consumer preferences? And finally, how about the immediate realization that Mexico must do more to increase the disposable income of its lower classes so as to bring down the price of the tortilla?

Yes; there's a downside to the rise in corn prices and that information is now up for all of us to see. But the upsides are in the picture too and as we see the entire story unfold, I predict that once again we will see that market forces commanded investment decisions within Mexico that were most beneficial to that country's economy, society, and development over the long run.

[investigateworld]

"And finally, how about the immediate realization that Mexico must do more to increase the disposable income of its lower classes so as to bring down the price of the tortilla?

Actually, you've got it backwards there. The increased income of the Mexican family, often via having a relative working in the USA, has increased demand for All foods. As a market has developed for other uses of corn, that puts a pressure on the selling price. Add these two factors together and we see the price of tortillas going up.

But as more growers see a profit opportunity, they'll add production and the price will swing down. Not trying to insult you with a basic lesson, but the bottom line is increasing disposable income will continue to inflate food prices.

[SAJ]

With an exploding population and the subsistence-level farming techniques used in large parts of that country, no they can't.

[Clemenza]

Says who? The birth rate in Mexico has been DECLINING rapidly over the past 30-40 years, from six per woman in late 1960s, to 2.3 today, per the World Bank.

[dennisw]

And recent reports out of Mexico show that their state-controlled oil production is starting to fall off.....

And like most of these 3rd world dopes they are pumpimg in an undisciplined way that will leave lots of oil unrecoverable, left in the ground for good

[Clemenza]

Remember that the oil was discovered and drilled by AMERICAN engineers, one of whom was William F. Buckley Sr. After the American investors brought black gold to Mexico, President Lazaro Cardenas proceeded to nationalize it.

[Minutemen]

Corn tortillas in Mexico are/were? subsidised by the Federales to be priced artificially low. I was down there 20 years ago, I think they were ten cents (dollar/peso equivalent) per kilo (2.2 pounds.)
They're bound to go up in price. Like everything else, corn is a world commodity too. When was the last time we could buy a loaf of bread for a quarter?

[dennisw]

Como Hugo Chavez

[Minutemen]

You are so right. Ethanol can never replace petroleum. B.T.U's per gallon is no comparison to gasoline. Costs more to distill it than the energy obtained from it.

[Liberty Valance]

[Liberty Valance]

http://www.organicconsumers.org/espanol/mexico.html

[maryz]

In the Bible, the references to corn, are actually to Old World grains (either wheat or barley).

Probably depends on the translation. Linguistic note: the English word "corn" originally meant only a little round thing (there's a reference in an Old English poem to "corns" of hail) -- hence, corns on one's foot, and corned beef (prepared with little lumps of salt), as well as the application to grains.

[Tolerance Sucks Rocks]

Yep. The sooner we can offer something like cellulosic butanol, the better off we'll be.

[HP8753]

They could grow potatoes and make Lefse.
Dry it out a little and nobody would know the diference. ,-)

[Tolerance Sucks Rocks]

I would proudly eat tortillas that some hot Mexican twentysomething woman slapped between her gorgeous thighs.

[HP8753]

Lefse

[StJacques]

In normal terms, assuming that demand for corn stays constant within a population as disposable income rises, you are correct because increasing disposable income always raises prices. But one of the points about raising the disposable income of the Mexican poor that has been made, and I think this was in another thread, is that as the disposable income of a Mexican family rises, so does the variety of food in their diet. The poorest families in Mexico rely upon corn and beans for over 70% of their dietary needs. As they move up the social ladder that percentage drops significantly as they get increasing amounts of protein from meat. So the demand for corn by a Mexican family at the lowest end of the social ladder is much higher than that of a Mexican family within the middle class which, if I remember correctly (and I might not) is about 35% of all dietary needs. I seem to remember reading that it is cut in half.

But with all that having been said, due to the irrepressible upward pressure on prices that comes with higher incomes, increases for prices elsewhere could still be expected, so your rejoinder was still valid.

[Sherman Logan]

Mexico no longer has an exploding population. Not surprising with about half of their young men in this country.

[investigateworld]

I don't think much if any of the increased revenue from the higher oil prices has reached the 'masses', even thought Pemex is supposed to benefit them ;^)

For the record, if I'd been born there, I too would run for the border.
Mecico should be very rich. Friends of mine in the mining biz say there are gold and silver and copper ore deposits there that would pay, even using American wage scales, but too many 'bites'...

[StJacques]

". . . but too many bites."

Yes; La Mordida is still a fact of Mexican life and, if you really want to see an informed perspective on it you might enjoy the Mark in Mexico Blog. He had a great piece up on taxi licensing that was both outrageous and disheartening just a couple of days ago.

And there is no question that the "masses" of Mexico did not benefit from the recent oil price surge at the hands of Pemex, which is a basket case and in need of major slashing and overhauling, though Mexico did retire about 20% of its foreign debt, which will benefit everyone there eventually.

[SAJ]

OK. I sit corrected as to population growth

But not, however, about Mexico's -- in broad -- primitive agriculture nationwide.

The original subject in the thread was corn, hence tortillas. I didn't even address the welfare-state mentality.

[SAJ]

Second-year chemistry: you will always get more BTUs from 7 carbon atoms than from 2. And you won't get squat, in terms of increased energy yields, from H₂.

C'mon, brutha, I don' need no ''Aaa-men'' here, I just need a ''DUH!''

[Clemenza]

I can't comment on the agricultural practices in Mexico, as I know little about agronomy not related to grapes. I did see old school microagriculture (as in tiny plots of land) when I visited the Indian villages in Chiapas a few years back.