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Rising Food Prices

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Rising food prices
Introduction:
Food prices have been on the rise and have become a global issue. Prices have soared over the past year and a half and threaten to go up further if issues are not addressed immediately. Below is a look at how prices have been over the past year. Figure 1. FAO Food Price Index: February 2007 - January 2008
Source FAO, 2008
In this project, we attempt to find out the causes for this price rise, the trends of the rise and the effects that this rise has had on us.
Causes:
1. High demand for food in developing countries:
The growing world population is demanding more and different kinds of food. Rapid economic growth in many developing countries has pushed up consumers' purchasing power, generated rising …show more content…

5. Bio Fuels:
With oil prices at an all-time high of more than US$100 a barrel and the U.S. government subsidizing farmers to grow crops for energy, U.S. farmers have massively shifted their cultivation toward bio-fuel feed stocks, especially maize, often at the expense of soybean and wheat cultivation. About 30 percent of U.S. maize production will go into ethanol in 2008 rather than into world food and feed markets. Worldwide, ethanol accounts for around 5 percent of grain production, according to statistics from the Earth Policy Institute.

The spike in corn prices began with the Energy Security Act of 2005, which increased the goal for ethanol use in the U.S., and Hurricane Katrina. Replacing the gas additive MTBE also contributed.

Rising food prices have led to a sharp change in tone in the biofuels industry. In the U.S., a number of senators, including presidential candidate John McCain, have called for relaxing or suspending the ethanol mandates and subsidies that are fueling an industry boom. Rising demand for biofuels, used in both ethanol and biodiesel production, has pushed up prices of commodities such as corn and rapeseed. Around 30% of the United States' corn production will be used to produce biofuels by 2010.
Source: EarthTrends, 2007 using data from Earth Policy Institute, 2006.

What can be done?
Sound Policy Actions for the Short and

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