Chinese city stews over rising cost of beef noodles
A global surge in food prices hits the popular dish
By Don Lee, Times Staff Writer
July 28, 2007

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But behind the stewing in Lanzhou is a global surge in food prices that is driving up the cost of such things as a latte at a Starbucks in L.A. and a tortilla in Mexico. Food prices worldwide have risen 23% in the last 18 months, according to the International Monetary Fund, partly because of soaring demand for corn to make ethanol.

With farmers shifting to grow more corn, they are producing fewer soybeans and less wheat. That's pushed up prices of grains that feed livestock and poultry, lifting the price of meats, eggs and other goods. Milk in the U.S. costs 10% more than at the start of the year.

In China, meat and poultry prices have increased 20% from a year earlier; eggs are up 28%. Besides higher grain prices, an outbreak of "blue ear disease" at pig farms cut into pork supplies, while growing incomes continue to bolster demand for meat, particularly along China's prosperous east coast.

Even the price of cheap instant noodles is up; Chinese media said this week that it would rise this week 20% to 40%, in part because the cost of palm oil, a major ingredient, had nearly doubled in the last year. Palm oil prices have been driven up by rising demand for biofuel in Europe and strong demand from food sectors in countries such as fast-growing India.

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