World Bank Reports that Food Prices Are Higher than Ever
By Akhila Vijayaraghavan
August 19th, 2011
A new report from the World Bank reveals that food prices are approaching the peak levels achieved in 2008. Global food stocks are on a decline, and since the population is going up, so goes demand, and prices along with them. The situation is further complicated by volatile oil prices which raise the cost of transporting food. All in all, food prices are a third higher than they were at this time last year. The price increase can have a life or death impact on the many millions of people that already live on the edge.
The World Bank found that staples such as wheat, soybean oil and sugar are respectively 55%, 47% and 62% more expensive than a year ago, while maize prices have shot up 84%, partly as a result of US demand for biofuels. The report says America’s demand for maize for use in the production of ethanol grew 8% over the year, adding that “this trend may continue, given the prevailing uncertainties in the energy market.”
Oil prices are currently 45% higher than July 2010 levels and the price of fertilizers has increased 67% over the same period. These two increases have pushed up food production costs. Somalia, which is currently in the grip of famine, saw maize prices rise over 100% and there are now more than 3.2 million people in urgent need of emergency food aid, the report states.