Coffee prices continue to climb
New York, NY, United States (AHN) – Coffee lovers face rising prices because prices for coffee beans continue to rise on commodity markets.
Retail prices for bagged coffee on grocery store shelves have already gone up and more price increases are expected.
Poor growing conditions in South America and other coffee-producing areas has caused concern over shortages of supplies, resulting in investor speculation in commodity markets that has driven up coffee futures prices by 95 percent during the past 12 months.
Companies that roast green coffee beans and sell bagged coffee have raised prices by varying amounts in response to the increased prices they must pay for green coffee beans.
Earlier this week J.M. Smucker increased prices by 11 percent. It marks the fourth time it has raised prices in a year. Smucker sells Dunkin Donuts, Folgers and Millstone brands. Kraft, which owns Maxwell House, has raised its prices three times recently.
Then on Wednesday, Starbucks announced plans to raise prices in mid-July by 17 percent for bagged coffee.
Green Mountain Coffee Roasters also announced plans to raise coffee prices by 10 percent.
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Increasing food prices caused by Local, not global, market forces
LONDON, United Kingdom (IRIN) – Banu Bibi’s shopping basket is becoming emptier. When she goes shopping in Dhaka, Bangladesh, she spends more than a year ago, but that money buys less. In 2010, for 134 taka (US$1.80), she could afford lentils and laundry soap, and the family’s favourite fish. This year she has to spend 185 taka ($2.50) just for the basics: more rice to make up for the lack of other food, and cheaper vegetables.
Banu Bibi lives in one of eight communities picked by a research team from the Institute of Development Studies in the UK to track the effects of rising food and fuel prices. For three years, with the help of partner organizations in Bangladesh, Indonesia, Zambia and Kenya, they have been talking to people in selected rural and urban communities about how rising prices affect their lives.
Banu Bibi’s experience is fairly typical. Her family is not starving; they still have food, but it is not the food they like and is not as nutritious as it could be. They certainly ate more and ate better before the food price shock and financial crisis of 2008. And across the world, homemakers are having to work harder, spending more time shopping or looking for food, and planning more carefully to stretch their budgets to feed their families.
A woman in Lango Baya, Kenya, spoke for many when she told the researchers: “You go to a shop to buy something with the same amount as you paid the previous day, only to be told that prices have risen.”
Although food and fuel prices did fall after the initial spike in 2008, they never went back to their previous levels, and this year they have jumped again. Only one of the four countries studied has experienced some respite this year – Zambia, where the price of maize, the staple food, has not increased.
Local locus
While the two previous studies concentrated on the mechanisms people used to cope with the rising prices, this time the researchers decided to ask some more political questions – why did people think prices were so high? Who was to blame? And what should be done about it?
“It was an interesting time, with the Arab Spring and unrest around the world, and we wanted to ask how people felt about the food and fuel price rises,” the research team leader, Naomi Hossain, told an audience at the University of Sussex, recently.
Her presentation coincided with the publication of a report into the global causes of rising prices by the British charity, Christian Aid. It analyzed recent movements on commodity markets, and concluded that much-vilified hedge funds were not the real culprits, instead singling out pension funds. They have very large pots of money, and have been pulling out of volatile stocks and shares and investing in funds linked to a basket of commodity prices, forcing fund managers to protect their positions by buying commodity futures on such a scale that they move the market.
But although commodity price rises are now an international phenomenon, extensively reported in the media, the people Hossain and her colleagues spoke to only looked for causes within their own country, citing hoarding and speculation, changing climate and environmental problems in their own area, and – overwhelmingly – their governments’ failure to care about the poor.
One interviewee in Bangladesh told them, “I don’t believe in this global market story at all. It is just an excuse for the government not to do anything.”
Hossain describes “a real failure of global civil society to get people to see how their livelihoods are connected to the global economy. I am not surprised people prefer local causes. It gives people a sense of agency; if it’s a global problem, then what can they do?”
Moral focus
But she has a certain sympathy for governments. There are more social protection schemes in place, for instance, than at the time of the first survey, despite governments having their budgets squeezed, but even so they get little credit.
Those who believe the government should “do something”, suggest banning exports, controlling prices, punishing hoarders and subsidizing basic foodstuffs. The researchers found a sense that it was the moral duty of a government to provide for its people, sometimes linked to notions of democracy. A woman in Kenya told them, “In the new constitution, we have the right to be provided [with] food by the government.”
The moral sense also extended to the business community. A rural doctor in Bangladesh said, “The businessmen should get some moral teaching. If they were afraid of Allah and conducted business honestly, the situation would improve.”
All in all, says Hossain, “There is a popular consensus about what is legitimate, about social norms and obligations. People set moral limits to the freedom of the markets.”
High food prices are not bad news for everyone. Another IDS research fellow, Xavier Cirera, pointed out that the rises followed a long period of low food prices, which had been very hard on farmers. “We always have to ask the question, what is the real price of food? And how can governments ensure better safety nets for the poor while ensuring that traders pass the benefits of price increases back to the producers? The evidence is that farmers are getting some benefit and are responding. But they are not realizing the full benefit of higher prices.”
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– Provided by Integrated Regional Information Networks.
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Oil companies Shell and Exxon rack up billions in profits on soaring oil prices
New York, NY, United States (AHN) – Royal Dutch Shell and Exxon Mobile oil companies both reported robust first quarter profits because of higher global prices.
Those higher prices amounted to $113.70 per barrel for US crude oil futures, the highest level in 2.5 years, and $125.71 per barrel for Brent crude.
That helped Anglo-Dutch firm Shell to record $6.9 billion in profits for the first three months of 2011, up a hefty 41 percent from the same period in 2010.
Texas-based Exxon group did even better reporting profits of $10.7 billion, up a whopping 69 percent from the same time last year.
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Polls indicate Tory minority win in Canada’s May 2 election
Ottawa, Ontario, Canada (AHN) – With less than two weeks to Canada’s May 2 national election, leaders of the major political parties are mulling their futures: forming a coalition or running a minority-led government in case they win. Latest polls indicate that the Conservatives would likely emerge the victors in the spring election, but have high chances of once more being a minority government.
Since the campaign period started, Conservative leader and incumbent Canadian Prime Minister Stephen Harper has been urging voters to elect a majority government to prevent a repeat of what happened in March when a no-confidence vote led to the collapse of the Tory-led government.
Since the polls consistently show that the Liberals remain in second place, Liberal leader Michael Ignatieff admitted Tuesday that he would try to form a government if voters still elect a minority-led Tory Party, although he ruled out forming a formal coalition with the New Democratic Party or Bloc Quebecois.
Ignatieff explained that even if the Conservatives win the most number of seats in the House of Commons, there is no need for another election if Harper does not secure the confidence of the House. Instead, the Governor General may use the Westminster tradition in which he would call on other parties to attempt to form a government. By so doing, the Liberals would avoid forming a coalition as he had promised Canadian voters, Ignatieff said.
But Ignatieff admitted he is prepared to work with other parties to seek their support to be able to form a minority-led Liberal government.
Harper acknowledged that if the Tories win only a minority, he is aware the other parties would come together in some form, minus being a formal coalition.
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Study links economy to suicide rate among employees
Washington, DC, United States (AHN) – The rise and fall of the suicide rate in the U.S. is linked with the economy, a Centers for Disease Control and Prevention study has found.
The report found the strongest link between taking one’s life and business cycles of boom and bust to workers in the age bracket 25 to 64. As a general rule, overall suicide rates go up during a recession and go down during an economic expansion.
James Mercy, CDC acting director of the Injury Center’s Division of Violence Prevention, said the findings highlight the need to have additional suicide prevention measures, particularly during times of economic weakness.
The study covered the years 1928 to 2008. It is the first research to establish a link between age-specific suicide rates and business cycles.
The basis of such connection are overall suicide rates that increased during the following landmark eras:
- Great Depression (1929 to 1933)
- End of the New Deal (1937 to 1938)
- Oil Crisis (1973 to 1975)
- Double-Dip Recession (1980 to 1982).
During the Great Depression, suicide rates jumped to a record-high 22.1 percent in 1932 from 18 percent in 1928.
Feijun Luo, CDC economist, explained in a statement, “Economic problems can impact how people feel about themselves and their futures as well as their relationships with family and friends. Economic downturns can also disrupt entire communities.”
Luo, who led the study, added, “We know suicide is not caused by any one factor – it is often a combination of many that lead to suicide. But there are many opportunities for prevention. Prevention strategies can focus on individuals, families, neighborhoods or entire communities to reduce risk factors.”
The study was published in the American Journal of Public Health. It was based on an examination of suicide rates for every 100,000 Americans during the 79-year coverage.
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Investors push crude oil prices to 2.5-year highs
Washington, DC, United States (AHN) – Traders pushed oil prices to highs not seen in more than two years, in part because the weaker dollar makes oil cheaper for investors using other currencies.
The possibility of a government shutdown has pushed the dollar down to its lowest value in trading against other currencies since 2009.
Oil is priced in and purchased with dollars in global markets.
On the New York Mercantile Exchange, light sweet crude for May delivery rose $1.10, or 1 percent, to $111.40 a barrel.
On the ICE futures exchange, Brent crude rose by $1.84, or 1.5 percent, to $124.50 a barrel.
Both sweet crude and Brent oil in trading earlier in the day reached levels not seen since September 2008. Light sweet crude reached $111.90 per barrel in intraday trading while Brent crude reached $124.84.
Even before crude oil prices reached two-and-a-half-year highs on Friday, International Monetary Fund officials earlier in the week said that high oil prices were here to stay. Oil prices have risen 12.5 percent over the past decade.
High gas prices are pushing down consumer demand in the U.S. and Europe while China is trying to dampen consumer demand there. However, other things are driving oil prices, including scarcity of supply to meet growth in demand from increased automobile ownership in India and China, unrest in the Middle East and investor speculation in global oil markets.
Gas prices for self-serve regular gas are up more than 20 cents from last month. According to the AAA’s Fuel Gauge Survey, the average price was $3.73.9 a gallon on Friday, up from $3.619 a week earlier.
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ACOs Spell Gold Rush For Health Care Consultants
Washington, D.C., United States (KaiserHealth) – For months, said Washington health-care attorney Rene Quashie, his phone has been “ringing off the hook,” with hospital and doctor clients wanting advice on how to reorganize themselves to get new Medicare bonuses under the health-care law. Handling such questions, said Quashie, an associate with the firm Drinker Biddle & Reath, is sure to be “a growth area” for his firm.
And a lucrative one.
From Washington to California, the year-old health law, with its layers of complexity, is setting off a gold rush for high-priced lawyers and consultants. It’s “a full employment act for health-care consultants,” said Ian Morrison, a founding partner of Strategic Health Perspectives in Menlo Park, Calif.
Much of the activity – and the prospect of glitteringly high fees – is swirling around a widely discussed provision that encourages doctors, hospitals and insurers to team up in treating patients. Initially, these “accountable care organizations,” as envisioned in the law, will treat only Medicare patients, and will get bonuses for providing better care at lower cost. But if they work, ACOs will likely spread to private patients as well.-
The ACO issue “has all the pieces that drive consulting,” said Morrison. “There are legal, information technology and cultural changes needed to make it work, so lawyers are happy as hell, IT people are happy as hell and so are the management consultants.”
Lobbyists, lawyers and consultants are holding frequent ACO conferences — and finding them oversubscribed. Some consultants are charging from $25,000 for a day of strategy sessions to $1 million to actually implement the strategy.
Gorman Health Group, a 150-person consultant firm based in Washington, charges $25,000 to $100,000 for an ACO strategy, which is usually done in conjunction with other work, said founder John Gorman, who was a Medicare official in the Clinton administration. Among the topics discussed: whether the health system has to make major cultural changes to become an ACO.
The Camden Group, based in Los Angeles, charges about $30,000 to $100,000 to advise health systems on how to get ready to become an ACO, said Steve Valentine, the firm’s president.
Meanwhile, Washington lawyer Randy Fenninger said his firm, Holland & Knight, is expanding its ACO practice in response to requests for advice from hospital and physician clients in Miami and Chicago.
The ACO frenzy is bound to increase. The Department of Health and Human Services on Thursday released a 429-page proposed ACO rule, and a final version is due by year-end. The first ACOs are scheduled to launch in January 2012.
“Every time there is a new programmatic initiative in D.C., there is a wave of new consulting opportunities,” said Jeff Goldsmith, president of the consulting firm Health Futures and associate professor of public health sciences at the University of Virginia. “But I have never seen anything quite like this in my 35 years in this business.”
Medicare pays physicians separately for individual services, which critics say leads to fragmented and excessive medical care. Under the proposed rule, ACOs that care for their patients at a lower than expected cost would reap bonuses from the money they saved Medicare. In some cases, those that had cost overruns would face penalties.
“ACOs are going to be part of the traditional Medicare program beginning in 2012, and if you are a hospital, you are seeing this and thinking money is going to go out of the system and its going to be taken out of your hide,” said Jay Cohen, executive chair of Monarch Healthcare, an independent physicians’ group in Irving, Calif. “So to preserve their interests and stay relevant, they are thinking they need to get control.”
Joan Mason of the Cleveland-based Gateway Group said many hospitals and doctors lack the necessary computer capabilities and other infrastructure to form ACOs soon. Last December, she said, a hospital wanted to hire her to create an ACO within six months. “I said ‘No, I can’t do it because you can’t go from zero to ACO.’ ” She said she’s planning a speech entitled “ACOs: Why Fools Rush In.”
Still, some say there are good policy reasons to move ahead with the new organizations. “ACOs are worth doing because we need to build systems of care,” said Steve Lieberman, a consultant and a fellow at the Engelberg Center for Health Care Reform at the Brookings Institution. “The system is fragmented, doctors are very unhappy and everyone wants to reduce the costs.”
The Engelberg Center provides about 100 health systems with access to its “Learning Network,” a collaborative between Brookings and the Dartmouth Institute for Health Policy & Clinical Practice. The center has charged $2,500 or more to members to join, depending on the type of health system. The network produces conferences, newsletters, webinars and access to ACO experts, such as Engelberg Center Director Mark McClellan — the former head of Medicare and Medicaid — and Dartmouth Center for Population Health Director Elliott Fisher. McClellan, who was Food and Drug Administration Commissioner under President George W. Bush, and Fisher are longtime proponents of the ACO concept.
A consultant’s bill for putting an ACO into place can be high. Premier, a Charlotte nonprofit alliance of 2,400 hospitals and 70,000 health-care providers, created an ACO implementation collaborative to help hospitals take advantage of the Medicare law and changes occurring in the private market.
Premier charges a $150,000 annual membership fee for access to its team of implementation consultants, who specialize in care management, physician integration, contracting, payment systems and network development. Camden Group charges $200,000 to $500,000, while the Advisory Board may charge as much as $1 million to implement an ACO plan.
Even insurers are getting into the consulting business. Aetna, which has long experience in managing costs of care, has started creating partnerships with health systems and will charge them consulting fees.
“Given the complex combination of requirements [for ACOs], we can raise our hands pretty frequently” to offer solutions, said Lonny Reisman, Aetna’s chief medical officer.
One reason doctors and hospitals turn to ACO consultants is to sort out the blizzard of pitches they’re getting from technology and other companies selling wares that they contend will pave the way to becoming one of the new organizations.
“Dozens of companies are pitching us regularly” on technology products and databases that supposedly will make it easier to become an ACO, said Tripp Jennings, chief medical information officer of Palmetto Health Quality Collaborative, which was launched by a South Carolina hospital system to create an ACO. “It’s a cornucopia of products out there, and what is challenging is that each of these products has its own piece of the solution.”
Provided by Kaiser Health News.
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U.S. stocks tumble, 3-day gain streak ends
New York, NY, United States (AHN) – U.S. stocks tumbled on Monday ending a three-day gain streak as investors shrugged off a report of higher consumer spending in February and retreated over geopolitical concerns.
The Dow Jones Industrial Average lost 23 points or 0.2 percent to close at 12,198. Home Depot was the biggest blue-chip decliner after announcing it will sell a $2 billion debt offering.
The Standard & Poor’s 500 Index slid 3.6 points or 0.3 percent to 1,310, dragged by Marriott International’s slump.
The Nasdaq Composite Index shed 12 points or 0.5 percent to 2,731 with eBay among the losers after announcing it will acquire GSI Commerce for $2.4 billion.
Oil for May delivery declined $1.42 to $104 per barrel.
Gold futures for April delivery fell $6.60 to $1,420 per ounce.
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U.S. stocks up for second straight day on surge of tech shares
New York, NY, United States (AHN) – U.S. stocks gained for the second straight day on Thursday as technology firms’ positive earnings reports beat concerns on crises in Japan and Libya.
The Dow Jones Industrial Average rose 85 points or 0.5 percent to 12,171 with Hewlett-Packard Co. as the top gainer.
The Standard & Poor’s 500 Index recovered lost ground since the earthquake and tsunami that struck Japan increasing 12 points or 0.9 percent to 1,310. Linux vendor Red Hat was the top gainer after reporting high earnings and raising its profit forecast. Other gainers were semiconductor maker Micron Technologies and chipmaker Nvidia.
The Nasdaq Composite Index climbed 38 points or 1.4 percent to 2,736.
Crude oil futures settled at $105.60 a barrel on the New York Mercantile Exchange. The oil for May delivery was 59 cents or 0.6 percent lower.
Gold futures for April delivery fell $3.10 or 0.2 percent to $1,440 an ounce.
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U.S. stocks extend surge for third day, Dow hits 12,000 mark
New York, NY, United States (AHN) – U.S. stocks continued its surge for the third straight day on Monday sending back the Dow Jones Industrial Average above the 12,000 level.
The $39 billion merger of AT&T and T-Mobile plus improving containment of overheating nuclear reactors in disaster-stricken Japan sparked investors’ rally that send the Dow rising 173 points or 1.5 percent to 12,036. The Dow was below the psychological level since after the March 11 earthquake and tsunami that hit northeastern Japan.
The Standard & Poor’s 500 Index closed 19 points or 1.5 percent up at 1,298 led by luxury retailer Tiffany & Co.
The Nasdaq Composite Index added 48 or 1.8 percent to close at 2,692.
Crude oil for April delivery rose $1.26 or 1.3 percent to settle at $102 per barrel. The rise came as an international coalition forces continued air strikes on Libyan military targets on Monday as part of a UN Security Council sanctioned no-fly zone aimed at protecting rebels in the north African country.
Gold futures for April delivery jumped $13.70 or 1 percent to $1,430 an ounce.
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