MEXICO CITY- President Felipe Calderón signed an accord with businesses on Thursday to curb soaring tortilla prices and protect Mexico's poor from speculative sellers and a surge in the cost of corn driven by the U.S. ethanol industry. The corn tortilla is the basic staple of the Mexican diet and is crucial for the poor.
The accord limits tortilla prices to 8.50 pesos ($0.78) per kilogram and threatens to use existing laws to achieve prison sentences of up to 10 years for officials found hoarding corn.
Some stores have been selling tortillas for as much as 10 pesos ($0.91) per kilogram.
It also raises quotas for duty-free corn imports to 750,000 metric tons, most of which will come from the United States.
The measure is to be reviewed for possible modifications on April 30.
FOR THE FAMILIES
''The unjustifiable price rise of this product threatens the economy of millions of families,'' Calderón said. ``We won't tolerate speculators or monopolists. We will apply the law with firmness and punish those who take advantage of people's need.''
The rise in tortilla prices has been one of the first major challenges for the conservative who took office in December, putting him in an uncomfortable position between the interests of business and those of the poor.
Tortilla prices rose by 14 percent in 2006, more than three times the inflation rate, and they have continued to surge in the first weeks of 2007.
The rise is partly due to U.S. ethanol plants gobbling corn supplies and pushing prices as high as $3.40 a bushel, the highest in more than a decade.
But Calderón also blames price gouging by Mexican middlemen who grind corn into flour and sell it to thousands of tortilla sellers across the nation.
''The increases in the international corn market do not justify the tortilla hikes in this country in the last weeks,'' Calderón said.
Under the accord, corn flour will be limited to 5 pesos ($0.46) per kilogram and corn itself will not exceed 3.5 pesos ($0.32) per kilogram, which is about the current market price.
Poster Comment:
Can you believe this??? With all the shit happening in the world, and AP finds this to be "newsworthy"... Hey TommyTheMadArtist - here's one for the "You gotta be shittin me" category!!!
Well, since they did it, (and I was stupid enough to post it - mainly because every once in a while we all need a mindless diversion from reality) it begs the question "What's wrong with this picture?"
For starters we see in the article "It also raises quotas for duty-free corn imports to 750,000 metric tons, most of which will come from the United States."
Good for Monsanto - bad for the Mexicans. They're now gonna be ingesting more GMO corn than ever. Do ya think maybe Monsanto has some "friends" close to Calderon???
We also see "a surge in the cost of corn driven by the U.S. ethanol industry." and "The rise is partly due to U.S. ethanol plants gobbling corn supplies and pushing prices as high as $3.40 a bushel, the highest in more than a decade."
Now I'm not against farmers getting more for their crops. Lord knows they deserve it. Their produce is so far behind inflation it's beyond laughable. BUT, this is pure nonsense being fed to the masses. Their propaganda machine is having us believe they're trying to do something about our dependence on oil - they're turning to "viable alternatives".. BULLSHIT. Let's look at ethanol...
The energy density of ethanol is less than petroleum, as the standard, accepted measurement of energy density for ethanol is 26.8 megajoules per kilogram. This clearly compares unfavorably with the energy density of gasoline at 45 megajoules per kilogram. So, you get a lot less energy per unit of weight. Worse, the energy return on energy investment of ethanol is "break-even at best", because oil just gets pumped out of the ground at minimal energy expense. Corn (the main grain used in ethanol) has the expense of working the soil, planting the crop, irrigation, harvesting, over-the-road transportation (as opposed to pipelines), and then "refining into ethanol".
Will the U.S. really wind up running its motorized culture on corn-based ethanol? According to Cornell researcher David Pimental, "If the entire U.S. grain crop were converted to ethanol, it would satisfy about 15% of U.S. automotive fuel needs." So the answer is no. But that doesn't mean we won't try!
So the bottom line is we slightly reduce the necessary increase in imported oil needed to satisfy an increasing demand for energy, but at the cost of making everybody's food horrendously more expensive!!! Because while the farmers are finally getting a much deserved "price hike" for their efforts - the REAL "price hike" will be gained (as always) by the middleman!! Hahaha! This whole story is too, too rich, and another fine example of government meddling at its worst!
OH, BTW - the best kept secret in America is that we have inflation under control... It has to be the best kept secret - because absolutely nobody in the country EXCEPT BigBro can see it.