Current Event Analysis: How Chinese babies and Mid-East pizza tip US markets. Omar
October 10th, 2014
In a BBC News article, writer Debbie Siegelbaum shows how international marketing of a certain product affects its prices worldwide as well as in domestic markets. In this particular case she features dairy products and the increased export of American dairy. She goes in depth about the causes and effects of the increased dairy export from USA. While the article may alarm domestic buyers of dairy it also explains how USA has become the world provider for yet another commodity they have had in surplus for years. The article also talks about the new surplus created in the European markets due to Russian ban on European and American dairy in retaliation to the sanctions placed on them for the Ukraine incident . Summary
The above mentioned article outlines how drought in New Zealand made the world turn to USA for their dairy imports. It also highlights the increased demand of dairy from Middle East due to the rise of the fast food culture in their countries and the Chinese import of American dairy due to their own market’s inability to supply quality products. The article progresses from acute shortage due to New Zealand’s drought and moves on to showcase the new supplier, i.e. USA. It continues on to explain how this external demand has caused the dairy surplus to dwindle and prices to spike in the domestic market. However, the author also conveys that there is hope for domestic USA market due to Russia’s sanction on European and American dairy and New Zealand’s slow but sure emergence from the shortage of dairy supply. It explains how European surplus can help mitigate the domestic prices in the U.S. in the middle of 2015 . Analysis
One of the biggest factors influencing the dairy sector is the government regulation of dairy industry in the United States. In 1985 the U.S Farm Bill included a dairy buy-out program in order to stop farmers...
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