Rising Food prices - Doomsday ahead?
I am not a believer in doomsday prophecies. I believe the world would be better off tomorrow for everyone vis-a-vis today. Ditto for world consumers. Not that there won't be hiccups along the way.
Consider food prices. I agree with Omkar Goswami when he says that there’s high probability of the world witnessing a fairly long cycle of food price inflation.
Consider the statistics. Between August 2007 and February 2008, low and middle income countries have seen:
28 per cent increase in the weighted price of all agricultural products
38 per cent increase in the price of food
49 per cent increase in the price of fats and oils
51 per cent increase in the price of grain.
Over the same period, global price of coconut oil has risen by 54 per cent; groundnut oil by 42 per cent; soybean oil by 57 per cent; maize by 47 per cent; rice by 42 per cent; US wheat by 71 per cent; bananas by 55 per cent; and sugar by 38 per cent.
As Omkar says prices will take some time to flatten and drop. Its not possible to up agricultural production in the short run. In fact the reasons behind the rise in food prices is so complex it requires near genius in policy making to get out of this price spiral.
Is Industrial farming the way out? Should the markets be the best regulator in such scenarios with minimal government intervention? Is the small farmer doomed?
Link to BBC's World debate, titled, 'Food - Who Pays the Price?' here.