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 99.

    20 years ago the EU had 3 years supply of food in storage for any event, so why the change?


    You cannot speculate on a stable supply, something bankers hate.

    Food and essential services are being controlled by profiteers.

    The milk issue recently, this will put small farmers out of production so big companies can control the supply, same result will be for grain, meat and veg.

  • 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 97.

    High food prices are nothing to do with hoarding or speculating they are due to the very real, year on year, problems of food production disrupted by poor weather conditions drought, flooding etc.

    Food prices are the very real affect of global warming causing extreme weather events around the world.

  • rate this

    Comment number 96.

    The problem in those countries that do not produce enough food themselves lies with a total lack of population control there.

  • rate this

    Comment number 95.

    Oxfam & such will always say such things. This country has put in many billions £s for many decades to feed other countries, where has the money gone that these countries cannot feed themselves, maybe its dont want to help themselves, just like those here on benefits who wont work but think its their right for others to pay for their lifestyle. Maybe oxfam employees should give up their pay.

  • rate this

    Comment number 94.

    Real Help by Richer nations wub be to restrict or ban Commodities Trading in Agriculture by Bankers

  • rate this

    Comment number 93.

    The complaints about the price of food in the UK is absurd.

    My wife and I only eat fresh from the supermarket. No tins, no frozen, no ready meals, despite what the media will say, it is cheaper to eat fresh - meat, vegetables and fruit.

  • rate this

    Comment number 92.

    Do not listen to their lies!

  • 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 90.

    "For too long our leaders have stood by complacently, while up to a billion people go hungry worldwide" says Hannah Stoddart, Oxfam's head of economic justice policy.

    What naive waffle! The 'Leaders' have been anything but 'complacent', I'm afraid. And they personally are doing just dandy out of a situation that leaves others starving.
    Hypocrisy & corruption abound on this issue on all sides.

  • rate this

    Comment number 89.

    Maybe the solution to global poverty is for more people to grow their own food.

    I have a good supply of runner beans this year with seed from last year's crop. I didn't pay for the water, either - it fell from the sky - and the soil was already in the garden.

  • rate this

    Comment number 88.

    40 percent of food goes bad because improper or insignificant storage India. now here is real problem with food.

  • rate this

    Comment number 87.

    Well perhaps if they did something to sort out the "unbelievable amount" of food just dumped as waste , by the big supermarkets every single day, that would be a start!

  • rate this

    Comment number 86.

    No matter what the commodity, whether there is a glut or a shortage of supply, middlemen always make a profit.

    Globalisation has opened up 'all' the markets for these middlemen to cream off more and more profit at the producer's and final consumer's cost.

    Example: Fresh produce from Israel, shipping paperwork via Scotland, delivered and consumed in Dubai.

  • rate this

    Comment number 85.

    As the world population increases by thousands an hour this problem is obviously not going to go away. As China, India, Latin America & Africa and the mega-rich M East take more, we in the West will be forced to take less of the planet's finite resources . That applies to everything, not just food.

    Get used to it - it's the future. Plan your life on having a lot less disposable income.

  • rate this

    Comment number 84.

    Global food prices sharply rebounded in July

    Did they ever go down??
    Not as far as consumers are concerned

    Nothing to see here folks

    move along move along

  • rate this

    Comment number 83.

    The big issue here that nobody wants to talk about is world population. After the fall of the Roman Empire 546 AD it took 13 centuries to add 200 million to the planet now we do that every 3 years. How many rain forests are we going to cut down just to feed ourselves? Reserves are irrelevant!

    All those obsessed with some rich person making a load of money out of reserves should wake up!

  • rate this

    Comment number 82.

    if poor want food they should do useful work to earn a living.
    food is sold on free market. the poor need to pay as well as rich.
    why is it liberals believe in teaching Darwin in school but whinge when it works in real world. survival of fittest means those who produce food get dictate rules on who gets fed. no money no food. farmers don't work for free.

  • 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 80.

    77 johnny Jumper. It would be a little difficult for the government to remove VAT from food as there is no vat on food (takeways yes and a few strange rules defining foods admittedly)


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