Just how much are the price of raw materials contributing to headline inflation? Well, the raw materials price index was released yesterday, and economist Stephen Gordon was curious, so he made some graphs.
The general raw materials index and the all-items CPI:
— Stephen Gordon (@stephenfgordon) November 18, 2023
The raw materials wheat price index and the CPI for bakery and pasta products 4/ pic.twitter.com/0qkHSl7Jty
— Stephen Gordon (@stephenfgordon) November 18, 2023
The raw materials crude oil price index and the CPI for gasoline 6/ pic.twitter.com/xD4gd0f1bH
— Stephen Gordon (@stephenfgordon) November 18, 2023
The raw materials cattle price index and the CPI for beef 8/ pic.twitter.com/DanoJRGDsX
— Stephen Gordon (@stephenfgordon) November 18, 2023
The raw materials price index and the CPI for chicken 10/ pic.twitter.com/B3v1DDETyW
— Stephen Gordon (@stephenfgordon) November 18, 2023
And I'm done for now. 12/12
— Stephen Gordon (@stephenfgordon) November 18, 2023
Things I noticed: While gasoline is a big driver of headline inflation, the prices of wheat and beef are worth taking a look at because of the price spikes. What caused those spikes? Drought. Drought killed 40 percent of the wheat crop in 2021, and also meant a shortage of feed crop for livestock, which meant that ranchers had to cull herds to be able to afford to feed the remaining animals (because importing feed is expensive). This year we also saw more drought, which is having the same effect (and that drought has been persistent in southern Saskatchewan, which has to be in danger of turning into a dustbowl soon). And yes, there is a direct correlation to these more frequent droughts with climate change.
Also worth pointing out is the price of chicken also spiking, which was because of avian flu that meant culling flocks to prevent transmission. Again, that drives up prices. This is just more data to show that it’s not the carbon price driving up food prices—it’s climate change and its knock-on effects.
Ukraine Dispatch:
Ukraine’s largest private energy company says that they need more missile defences to protect power plants in advance of more Russian attacks over the winter. Ukrainian forces have confirmed that they have established several beachheads on the eastern banks of the Dnipro river, which is an important step in the counter-offensive. In Kharkiv region, the government is now building fortified underground schools because of the constant attacks. A Yale study says that more than 2400 Ukrainian children from four occupied regions have been taken to Belarus.
https://twitter.com/zelenskyyua/status/1725490287160529137
⚡️Nearly 4,000 cyberattacks reported in Ukraine since start of war.
Nearly 4,000 cyberattacks were recorded by Ukraine's Computer Emergency Response Team between January 2022 and September 2023, a U.S. Treasury Department official stated on Nov. 17.
— The Kyiv Independent (@KyivIndependent) November 18, 2023