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Food inflation

Global food prices skyrocketing; up 10 percent in month of July alone

Thursday, September 06, 2012 by: David Gutierrez, staff writer
Tags: food inflation, World Bank, warning

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(NaturalNews) Global food prices leaped 10 percent between June and July, the World Bank has warned, pushing corn and soybean prices in particular to record highs. The newest estimate outstrips even the recent alarming warning by the United Nations Food and Agriculture Organization, which had noted a six percent increase over a similar time frame.

"Food prices rose again sharply threatening the health and well-being of millions of people," said bank President Jim Yong Kim. "Africa and the Middle East are particularly vulnerable, but so are people in other countries where the prices of grains have gone up abruptly."

Experts have assigned much of the blame to severe summer weather. A long drought has devastated wheat harvests across Eastern Europe, particularly in Kazakhstan, Russia and Ukraine. In the United States, the summer has been the hottest ever recorded since the National Oceanic and Atmospheric Administration began keeping records in 1895. Combined with a drought, the record heat turned what had originally been predicted to be a record high corn harvest into the smallest since 2003. U.S. soybean crops have also been devastated.

The World Bank also blamed U.S. ethanol production, which consumes 40 percent of the country's corn crop, for record high corn prices.

"Historic" increases threaten the world's poorest

According to the World Bank's report, corn and wheat prices increased 25 percent between June and July, and soybean prices increased by 17 percent over the same time period. The price of corn has actually doubled in the past two years, while the price of soybeans has doubled in the past five.

Rice was the only staple to show a decrease, with a price drop of four percent. The overall food price globally increased by six percent between July 2011 and July 2012, reaching a new record high over the prior peak of February 2011.

The World Bank warned that food-importing countries in Africa and the Middle East will be hardest hit by the price increases. Troublingly, these also tend to be countries where people spend a greater proportion of their income on food.

The price of corn has already increased by 113 percent in Mozambique in the past three months. In South Sudan, the price of sorghum surged 220 percent in the same time period.

The Malawi Vulnerability Assessment Committee has warned that 1.63 million people in that country will be unable to meet their food needs by March, now that a long drought has forced Malawi to import more of its food. The price of corn increased 174 percent in Malawi between July 2011 and July 2012. The World Bank has called for individual governments to increase food aid programs domestically.

"We cannot allow these historic price hikes to turn into a lifetime of perils as families take their children out of school and eat less nutritious food to compensate for the high prices," World Bank President Jim Yong Kim said.

Many nonprofits, in contrast, have called for richer countries to address the inequities of the global food system. Yet the G20 (a group of the world's foremost economies) has announced that it will take no action on the food crisis until after the U.S. Department of Agriculture releases its harvest estimates in September. This move was condemned by the hunger nonprofit Oxfam.

"This 'wait and see' attitude is unacceptable," said Oxfam spokesperson Colin Roche. "Oxfam is already seeing the devastating impact of food price volatility in developing countries that rely on food imports."

Analysts are unsure what will happen to food prices in the near future, as the upcoming El Nino weather event is just as likely to boost South American harvests as to devastate Australian ones.
Sources for this article include:
http://www.naturalnews.com/036695_food_prices_drought_crop_yields.html http://latimesblogs.latimes.com
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