April 4, 2008

The Price of Food - ten questions

Ten questions and answers from the United Nation's Food and Agriculture Organization:
1. Why are food prices rising?
Prices of most agricultural food commodities have risen sharply during the past two years. Several factors have contributed to this development: (1) low levels of world stocks (especially for wheat and maize) following two years of below-average harvests in Europe in 2006 and 2007; (2) crop failures in major producing countries like Australia in 2006 and 2007; (3) rapidly growing demand for grain-based biofuel production supported by subsidies; (4) gradual changes in agricultural policies of the OECD countries, where reduced levels of subsidies have led to lower surplus production; (5) strong economic growth in developing countries and expanding world population. In addition, agricultural markets are becoming increasingly intertwined with non-agricultural markets (energy, manufacturing, finance, etc.). Climate change and resource constraints (water supply in particular) are also influencing overall food supply and demand.
Good stuff... Posted by DaveH at April 4, 2008 9:46 PM
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