Food prices

October 2012
Overview

Between the 1950s and the early 2000s, prices of cereals on world markets fell in real terms remarkably: in 2001 the price of maize was just 25% of the 1957 level, while those for rice were 20% and for wheat 31% of that level. Yet subsequently these prices have tended to rise, with a notable spike in 2007/08 producing the sharpest increase in food prices seen in the 34 years since the early 1970s. Prices fell back, but again have surged to remain well above those seen at the turn of the century.

Forecasts for the next ten years see cereals prices as remaining high in real terms. Moreover, there are fears that volatility of prices may be increasing so that the chances of another price spike are uncomfortably high.

Price spikes are damaging to the poor, at least in the short term. Even if most of them live in rural areas and have livelihoods in and around farming, many are net buyers of food so that increases in food prices lead to hardship and potentially to malnutrition. At national level, low income countries are faced by heavy increases in the cost of imported food, draining foreign exchange, importing inflation, and putting a brake on their growth and development.

In the medium term, however, farmers will have more incentive to produce more and may see their incomes rise. More agricultural output at higher prices could well benefit smallholder farmers, those who work for them, and those who work in food processing and marketing.

As the world adjusts to higher food prices, ODI studies:

  • Changes in international cereals markets, tracking prices and their determinants to anticipate significant price movements in the near future;
  • The causes of higher food prices, including links to oil prices and associated demand for biofuels;
  • The impacts of higher prices on poor and vulnerable people;
  • Potential policies to mitigate harm, as well as policies to help farmers grow more food, and push prices back down; and,
  • Links from agriculture to poverty to hunger and malnutrition.

 

Agricultural Development and Policy
Outputs

China: are changes afoot for cereals?

Briefing papers | July 2012 | Steve Wiggins and Sharada Keats
This Project Briefing provides an overview of China's impact on the world cereals market and examines whether recent changes will impact on current Chinese production.
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Navigating the maize story

Articles and blogs | 26 July 2012 | Steve Wiggins and Sharada Keats
'Given the probable health benefits of a modest intake of meat, how long before policy-makers in Beijing take firm measures to encourage diets similar to those seen across the Yellow Sea?'
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Food prices special: US maize harvest in trouble

Research reports and studies | July 2012 | Steve Wiggins and Sharada Keats
ODI’s Food prices updates focus on tracking international prices of key staple cereals maize, rice, and wheat, and provide commentary on events in markets that affect these prices. They also follow international food and commodity price indices. This special update...
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Food Price Update March 2012 Annual Review

Research reports and studies | April 2012 | Sharada Keats and Steve Wiggins
March 2012 - Annual Update: ODI’s Food prices updates focus on tracking international prices of key staple cereals maize, rice, and wheat, and provide commentary on events in markets that affect these prices. They also follow international food and commodity price...
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Food Prices – is the only way up?

Articles and blogs | 18 October 2011 | Steve Wiggins, Andrew Norton and Anna Locke
This blog provides an overview of a roundtable event that brought together key people involved in the food prices agenda to understand the differences in projections of food prices that have emerged over recent months and possible policy responses to this.
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Food price dynamics: Where to now?

Round-table | 7 October 2011 01:30 - 17:30 (GMT+01 (BST))
Where are prices of cereals headed over the next ten years? And what does this imply for policy? These questions were addressed at a workshop with presentations from Merritt Cluff of FAO, Dirk Willenbockel from IDS and Chris Gilbert from Trento University. All agreed...
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Cereals prices in 2020: how worried should we be?

Articles and blogs | 12 September 2011 | Steve Wiggins and Sharada Keats
Recent forecasts reveal vastly different perspectives on future cereals prices: on the one hand seeing substantial increases by 2020, and on the other, seeing a gradual decline from current levels. Why do these forecasts differ? Which is more likely to be correct? And...
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Is fretting about US and EU biofuel policy missing the point?

Articles and blogs | 9 November 2010 | Steve Wiggins and Henri Leturque
With food prices rising again, concern rightly mounts over land being used to grow biofuels. While there is good reason to criticise US and EU policies to replace transport fuels from oil by biofuels, the real issue is protecting tropical forests and other land from...
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Food price updates

Publication Series
ODI’s Food Price Updates focus on tracking international prices of key staple cereals maize, rice, and wheat, and provide commentary on events in markets that affect these prices. They also follow international food and commodity price indices. Each edition tends to...
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