A sudden food price spike in 2008 led to food riots across parts of the world that are in danger of soon being repeated. Weather concerns and increased demand have led to similar price increases over a short span of time that may replicate the conditions that led to 2008's food riots.
As supplies decrease, prices rise-- and supplies of major crops have been impacted across the globe. Prices for various grains are on the rise after low production years in Canada and Russia; low soybean yields have resulted from unusually dry weather in South Africa; much of Australia's wheat supply succumbed to recent floods. As a result of these events, the United Nation's Food and Agriculture Organizations says its food index price increased more than 30% in the last six months.
Higher oil costs also contribute to expensive food, increasing the cost of shipping and causing production to look for different methods, often resorting to biofuel production that decreases supplies for humans to eat. The United States is at less of a disadvantage due to its higher consumption of processed foods, meaning that the dwindling resources comprise a smaller portion of total foods sold.
While price surges that occur too quickly could potentially lead to food riots, the silver lining is that they can also reflect improving economic situations for many nations. As long as the population can maintain equilibrium with the rising cost of food, increased prices may lead to sustainable economic growth.
Posted: 1-21-11
