Food prices have been increasing sharply. According to the World Bank, global food prices have climbed by 83% over the last three years. The real price of rice rose to a 19-year high in March 200―an increase of 50% in two weeks alone―while the real price of wheat hit a 28-year high, triggering an international crisis.

The increase in food prices is impacting the most vulnerable – the poor are particularly affected, as their diets rely on the very staples that are becoming too costly: cereal grains, cooking oil, and dairy. However, the crisis is being felt not only by the poor, but is also eroding the gains of the working and middle classes, while investors and speculators are busy moving financial capital into food commodity markets after the housing bubble burst in 2007. In the meanwhile International Financial Institutions are promoting further trade liberalization and technological fixes such as the Green Revolution to boost agricultural production.

This Policy Brief examines the impact and causes of the soaring food prices and explores the viability of solutions recommended by the World Bank, WTO and the IMF to deal with growing hunger. It then makes own recommendations on how to stave off the starvation.

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Scroll Down to See Other Publications Realted to the World Food Price Crisis

UN agencies are meeting in Berne to tackle the world food price crisis. Heads of International Financial Institutions (IFIs), including Robert Zoellick, President of the World Bank (former U.S. trade representative) and Pascal Lamy, WTO's Director General, are among the attendees. Will the "battle plan" emerging from the Swiss capital, a charming city with splendid sandstone buildings and far removed from the grinding poverty and hunger which has reduced people to eating mud cakes in Haiti and scavenging garbage heaps, be more of the same -- promote free trade to deal with the food crisis?

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Also See Food Price Crisis: A Wake Up Call for New Policies to Eradicate Hunger

In the midst of the growing world food crisis, International Assessment of Agricultural Science and Technology (IAASTD), an independent and multi-stakeholder international assessment of agriculture has concluded that a radical change is needed in agriculture policy and practice, in order to address hunger and poverty, social inequities and environmental sustainability questions.

The final report of IAASTD, the product of work of over 400 authors, was finalized at a meeting of over 50 governments held in Johannesburg 7-12 April 2008.

The report’s message is that the business-as-usual scenario of industrial farming, input and energy intensiveness, and marginalization of small-scale farmers, is no longer tenable. While past emphasis on production and yields had brought some benefits, this was at the expense of the environment and social equity. Moreover, there is a recognition that excessive and rapid trade liberalization can have negative consequences for food security, poverty alleviation and the environment.

Lead Author of IAASTD's East and South Asia and the Pacific Report, Lim Li Ching, Senior Fellow at the Institute Reports

Read the Summary of the IAASTD Report

In October 2005, the Oakland Institute published its report, Food Aid or Food Sovereignty? Ending World Hunger in our Time. Since then the issue of food aid has taken center stage in foreign aid, global hunger, and development discourse, sparking interest and debate amongst policy makers, media, and civil society internationally. The current food price crisis has further intensified the debate and the need for reform of international food aid.

Given food aid is usually counter-cyclical with commodity prices – when food prices go up, food aid goes down – food aid flows dropped to their lowest level since 1973 and further decline is expected as food prices continue to rise. For instance, the U.S. provided less than half the amount of food aid in 2007 that it did in 2000. The World Food Programme has announced that to maintain the same amount of food aid in 2008, it will have to spend 30% more resources than in 2007, which requires a budget increase of $500 million. Without this increase, the WFP will have to drastically cut food rations or the number of people it assists.

The causes of hunger are many: war and conflict situations; recurring droughts caused by changing climate patterns; declining public support for agricultural production, particularly for small-scale agriculture; trade liberalization that compels developing country farmers to compete with low-cost imported goods, undermining local production; and other economic and political factors. The solutions to these problems are complex too, but really not out of the realm of possibility.

This new report from the Oakland Institute is not merely an update of Food Aid or Food Sovereignty??, but a call for action. It examines the most pressing issues in the food aid debate today and highlights the promise and need for a long-term and human rights-based approach to food security and the elimination of hunger.

Download The Status of International Food Aid Negotiations

Download Food Aid or Food Sovereignty? Ending World Hunger in Our Time

In recent weeks, several UN agencies have issued warnings against impending "food riots" because of the acute hike in prices of rice, corn, wheat, and other staples. Morocco, Guinea, Egypt, Mexico, Haiti, Yemen, Mauritania, Senegal, Indonesia, and Uzbekistan have already been rocked by mass protests. The World Food Program (WFP), which feeds 73 million people in almost 80 countries, has called upon donor governments to close the $500 million funding gap by May 1, 2008 or it may not be able to make its food aid commitments. Worst affected by resulting hunger are the poor, surviving on less then $2 a day, in developing countries.

World food prices rose by 39 percent between February 2007 - 2008. The real price of rice rose to a 19-year high in March – an increase of 50 per cent in two weeks alone – while the real price of wheat has hit a 28-year high, triggering an international crisis. Various causes for this crisis are being cited in policy circles, including increased demand from China, India and other emerging economies , rising fuel and fertilizer costs, climate change. World Economic Outlook (WEO) just released by the IMF, holds bio-fuels responsible for almost half the increase in the consumption of major food crops in 2006–07.

Governments are resorting to desperate measures to address growing social unrest before it destabilizes countries.It is however essential to understand the underpinnings of this food crisis before rushing to adopt policy solutions.

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Later this year, the Bush administration is set to have discussions with lawmakers on whether the US import tariff (US $0.54 per gallon) on ethanol should be allowed to expire or not. Designed to protect US corn-based ethanol makers from cheaper imports, elimination of this import tariff is expected to have wide implications for ethanol exporting countries, especially Brazil that accounts for more than 70% of imports (2006 figures).

While Brazil's leadership on biofuels - particularly sugarcane-based ethanol - has been held as a global model for sustainable biomass production, a new report from the Oakland Institute and Terra de Direitos, Food & Energy Sovereignty Now: Brazilian Grassroots Position on Agroenergy, describes the opposition that biofuels face from the Brazilian social movements and civil society, as formulated at the First National Agroenergy Conference, held in Curitiba, Brazil in October, 2007. The report also exposes how the 'ethanol factor,' within the current drive for 'energy security' in the US, is becoming the integrating force in the region that is shaping a new geopolitical configuration in Latin America.

Read the Press Release

Click Here to Download the Report

Click Here to Download the Report in Portuguese

Find Out What Heating Homes in New York City with Biodiesel Has to Do with Deforestation in the Brazilian Amazon

On October 24, marking the 62nd anniversary of the United Nations, Anuradha Mittal and the Oakland Institute received the United Nations Association (UNA) East Bay's 2007 Global Citizen Award, in recognition of the Institute's work to promote social and economic justice globally.

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