Global food prices rise in July due to extreme weather

A grasshopper sits on a drought-damaged ear of corn near Council Bluffs, Iowa Drought in the US has hurt crops, and the world's poorest

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Global food prices sharply rebounded in July due to wild swings in weather conditions, a UN food and agricultural body has said.

The rise has fanned fresh fears of a repeat of the 2007-2008 food crisis which hurt the world's poorest.

Untimely rains in Brazil, drought in the US and production difficulties in Russia drove the rally, said the Food and Agriculture Organization (FAO).

Food prices jumped 6% in July from June after falling three months in a row.

The FAO food price index measures the monthly price changes for a basket of food commodities including cereals, oilseeds, dairy, meat and sugar. The index reading in July was still well below the all-time high reached in February 2011.

The Rome-based organisation took the surprise step of publishing the index this month - which it usually does not - due to the exceptional market conditions affected by unusual weather patterns.

Start Quote

There is a potential for a situation to develop like we have back in 2007-2008”

End Quote Abdolreza Abbassian FAO senior economist

Cereal prices surged 17%, while sugar leapt 12% to new highs in July from the previous month after rains hampered sugarcane harvesting in Brazil, the world's largest producer.

Delayed monsoons in India and poor rains in Australia also contributed to higher prices.

'Anything is possible'

"The severe deterioration of maize crop prospects in the US following extensive drought damage pushed up maize prices by almost 33% in July," said the FAO.

The price of rice and dairy was unchanged, although meat fell 1.7% due to a slump in pork prices.

The surge in prices have renewed fears of a food crisis that plagued countries in 2007-2008, sparking violent street protests in countries like Haiti and Egypt.

"There is a potential for a situation to develop like we have back in 2007-2008," said FAO senior economist and grain analyst Abdolreza Abbassian.

"There is an expectation that this time around we will not pursue bad policies and intervene in the market by restrictions, and if that doesn't happen we will not see such a serious situation as 2007-2008. But if those policies get repeated, anything is possible," he added.

Higher food prices hurt the world's poorest countries because it means they will need to pay higher import bills as they do not produce enough food at home.

'Global alarm'

Oxfam said that since the beginning of the year, rising food prices and drought had caused a food crisis in the Sahel sub-region of west and central Africa, affecting more than 18 million people over an area of land as wide as the US.

"This is not some gentle wake-up call - it's the same global alarm that's been screaming at us since 2008," said Hannah Stoddart, Oxfam's head of economic justice policy, regarding the FAO data.

"These latest figures prove yet again that there is something fundamentally flawed in the way we produce and distribute food around the world. For too long our leaders have stood by complacently, while up to a billion people go hungry worldwide," she said. "The time to act is now."

The UK government plans to host a global hunger event on 12 August in London which will also address poverty and malnutrition in children.


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  • rate this

    Comment number 98.

    Yes, blame the weather, rather than blame the governments which impose costly and burdensome regulations, high taxes, inflation (printing money) and other egregious distortions on the market, all of which massively drive up the cost of food. "The weather" - what a convenient scapegoat for government to hide behind and for the BBC to propagandise for. Tell the truth, BBC!

  • rate this

    Comment number 91.

    Reduce over-consumption of food would help particularly in the West and the better off parts of the world, where also large amounts of food are just wasted. This also fuels obesity and also takes scarce resources like water away from poorer countries, as do importing flowers. There is enough food production to feed the world, just consumption is not excessive in some parts of the world.

  • rate this

    Comment number 81.

    I don't want to sound negative, but what worries me in particular is that with the increasing use of Bio Fuels, while making energy consumption more sustainable, we actually reduce the use of land for food production.
    I understand there's a great money-incentive for global farming to go in that direction, but on the whole perhaps it's the wrong idea and causes more problems that it solves.

  • rate this

    Comment number 61.

    Time to change our diet and eat less meat and more grain and fish, like we did just 20 years ago.

    For each KG of beef the cow eats 10KG of grain.

    Eating meat every day will soon be something the rich do.

    With modern farming methods, this country CAN feed itself, we just need to accept a diet with slightly less meat in it.

  • rate this

    Comment number 31.

    'The UK government plans to hold a global hunger event'

    Seems like a bit of an empty gesture when so many countries are already hosting a 'hunger event' on a daily basis.

    I wonder what the 'UK government' thinks it will achieve?


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