"Global food prices hit new record high"
Global food prices increased for the eighth consecutive month in February, with prices of all commodity groups monitored rising again, except for sugar, [UN Food and Agriculture Organisation] said today.
What is driving up food prices to record levels? As I’ve discussed in CP’s food insecurity series, it’s harvests ruined by extreme weather, coupled with rising oil prices, increasing demand from population growth and changing diets in a global market made all the tighter by unsustainable biofuels policies.
The only good news going forward is that the Chinese drought has abated somewhat.
Here’s more from the FAO release:
FAO expects a tightening of the global cereal supply and demand balance in 2010/11. In the face of a growing demand and a decline in world cereal production in 2010, global cereal stocks this year are expected to fall sharply because of a decline in inventories of wheat and coarse grains. International cereal prices have increased sharply with export prices of major grains up at least 70 percent from February last year.
“Unexpected oil price spikes could further exacerbate an already precarious situation in food markets,” said David Hallam, Director of FAO’s Trade and Market Division.
“This adds even more uncertainty concerning the price outlook just as plantings for crops in some of the major growing regions are about to start,” he added.
Unless oil prices come down sharply and soon, it’s likely to get worse before it gets better.
- Grantham’s “Things that Really Matter in 2011 and Beyond”: “Global warming causing destabilized weather patterns, adding to agricultural price pressures”
- The Corn Ultimatum: How long can Americans keep burning one sixth the world’s corn supply in our cars?
- S. Korean President: “There is an increasing likelihood of a food crisis globally due to climate change.”