Why are food prices increasing?
Food prices have soared because agricultural production has not kept up with the rising demand of cereals for food consumption, cattle feeding and biofuel production. For the first time in decades, worldwide scarcity of food is becoming a problem. Global cereal stocks are falling rapidly. Some predict that US wheat stocks will reach a 60-year low in 2008. Population growth in poor countries is boosting the grain demand for food consumption. But cereal demand for the feeding of cattle is increasing even more rapidly as consumers in both rich countries and fast growing economies are eating more dairy and meat. The most important factor behind the sudden spike in food prices, however, is the rapidly growing demand for biofuels, particularly in the EU and the US. Of total corn production, 12% is used to make biofuel, and that share is growing fast. Concerns about global climate change and soaring energy prices have boosted demand for biofuels. Until recently, few voices critical of biofuel