Food prices likely to increase, UN report claims


The looming food crisis has been predicted to become the tipping point of a shift in certain economics. Some experts project those countries with abundant supply of certain food items will move upwards in the economic ladder.

A recently-revealed report by the United Nations is claiming that further sharp price hikes and continued volatility in markets for food supplies appear to be likely for the next few seasons.

The report by the United Nations Food and Agriculture Organization (FAO) was released Wednesday, May 28, in the run-up to a summit on the global food crisis and is being held in Rome early next month.

FAO lists 22 countries that it says are particularly vulnerable to food price increases because of high levels of chronic hunger and because they are net importers of both food and fuel. The report cites Eritrea, Niger, Comoros, Haiti and Liberia as being especially at risk.

“We hope that world leaders coming to Rome will agree on the urgent measures that are required to boost agricultural production, especially in the most affected countries, and at the same time protect the poor from being adversely affected by high food prices,” said FAO director-general Jacques Diouf.

According to the FAO report, increases in domestic food prices, even by moderate rates of 10 to 20 percent, can have immediate negative impacts on poor households that spend a large part of their income on food staples.

Protecting the most vulnerable in rural and urban areas will require targeted direct food distribution, food subsidies and cash transfers, as well as nutritional programs including school feeding, FAO said.

The UN agency has also urged for the distribution of seeds, fertilizers, animal feed to small-scale farmers through vouchers or smart subsidies.

FAO has appealed for $1.7 billion to provide seeds, fertilizers and other inputs to boost production in low-income and food deficit countries.

The report argues that high food prices represent an excellent opportunity for increased investments in agricultural research and infrastructure, noting that support should focus on the needs of poor farmers, many of whom farm in increasingly marginal areas.

Participants at the June 3-5 summit will discuss how agriculture can be harnessed to produce enough food to meet the demands of the world’s growing population. Many heads of state and government, as well as UN Secretary-General Ban Ki-moon and the heads of many UN organizations and the Bretton Woods institutions are expected to attend the event.

The new international task force – brings together the heads of key UN agencies, the International Monetary Fund World Bank and other international experts – on the global food crisis, chaired by Mr. Ban, is due to present its action plan.

Meanwhile, it was announced today that Spanish football captain and FAO Goodwill Ambassador Raúl González has been awarded the Spanish prize for solidarity in sports.

Mr. González has donated the $47,000 prize money to the FAO’s Telefood Fund, which provides micro-finance to poor farmers around the world.

Soaring food prices have resulted in riots in Bangladesh, Haiti and Egypt.