Why Did Global Food Prices Rise? - Term Paper.
Global Food Prices On the Rise.. Global food prices rose by 1 percent in March, and there was a particularly large increase in the price of dairy products.
As food supplies surged (and demand, hit by the global recession, stagnated), prices plummeted. Between its peak in July and a trough in December 2008, The Economist's index of food prices fell by.
But as the FAO food Price Index averaged nearly 171 points, global food prices still stand at 13% higher than at the same stage last year. Sugar prices declined by nearly 11%, vegetable oil prices are down by 6%, cereal prices dropped by 1.8% and growing supplies of milk led to a 2.3% decline in March.
Upali said supply issues should ease as the year progresses, but he did not speculate on whether the meat price index will continue to defy global decline in food commodity prices. The United Nations agency FAO publishes a monthly trade-weighted index of international prices for five major food commodity groups: sugar, vegetable oil, cereal, dairy and meat.
In terms of demand side causes, it has been suggested that global population growth may be a cause of the long term rise in food prices. According to the International Food Policy Research Institute, over past years global food production has been increasing at around 1 to 2% per year, while population has been increasing at approximately 4%.
This increases their exposure to supply and price risks instigated abroad. The UN's Food and Agriculture Organization (FAO) reported a 45% increase in the world food price index during the 2008 food crisis. Wheat prices increased by 130% relative to 2007 levels. Similarly, soy prices went up by 87%, rice prices by 74%, and maize prices by 31%.
Nevertheless it still cause the food prices to rise currently. The consequences. The consequences of the price rises for individuals are dissimilar. Although the cost of food production have raised due to high oil price, big farm owners, particularly who can get access to the world market would be benefited definitely.