Higher food prices are coming to a store near you

Imagine you walked into Super-A and found that the price of a box of cereal had doubled to $10. I guess we’re not buying cereal this week.

Imagine you walked into Super-A and found that the price of a box of cereal had doubled to $10.

I guess we’re not buying cereal this week.

In the next aisle, a loaf of bread is $8. Hmm … no bread this week either. How about $10 a pound for butter? 

Around the world, consumers are waking up to this realty. 

At least one person was killed in Ivory

Coast last week during riots brought on by rising food prices. The protest was the latest in a series of similar demonstrations throughout the world spurred by food shortages and subsequent rising costs.

Several West African countries, including Cameroon, Burkina Faso and Senegal, have experienced violence as a result.

The protests are linked to the high price of oil, the growing demand for bio-fuels and the expanding economies of Asia and Latin America.

They come as the head of the UN World Food Program warned rising food prices had helped create a “perfect storm,” leaving more people hungry than ever before.

“The cost of our food has doubled in just the last nine months,” said World Food Program executive director Josette Sheeran.

“We’re very concerned about our operations.”

The problem is global.

In Haiti, people are dying in violent protests sparked by a 50 per cent rise in the cost of food staples in the past year.

From Egypt to Vietnam, price hikes of 40 per cent or more for rice, wheat and corn are causing unrest and forcing governments to take drastic steps, such as blocking grain exports and arresting farmers who hoard surpluses.

The UN International Fund for Agriculture predicts food riots will become common on the world scene for at least a year. The World Bank says 33 countries face unrest from higher prices in both food and energy.

The food price hikes may not be temporary, according to the World Food Program, which sees long-lasting causes, such as spreading deserts and more demand for grain-fed meat.

The program, which feeds millions of the world’s poorest people, warns its rich donor nations that it will require more money for some time to come. Its latest requirement: $500 million more by May 1 of this year.

Even the conservative magazine The Economist warned last week: “The rising cost of food in general is now pushing millions back into the poverty from which they only recently escaped.”

The World Bank weighed with its own gloomy forecast.

“High and volatile food prices will be with us for years to come,” said its president, Robert Zoellick, who urged wealthy nations to cut agricultural subsidies and open markets for food imports.

“Food policy needs to gain the attention of the highest political levels, because no one country or group can meet these interconnected challenges,” continued Zoellick in a speech delivered in Washington on April 2.

Since 2005, the prices of staple foods have jumped 80 per cent. Last month, the real price of rice hit a 19-year high; the real price of wheat rose to a 28-year high to almost double the average price of the last 25 years.

Rice, the staple food for about 3 billion people, has surged on increased imports by the Philippines, and as China, India and Vietnam cut exports to boost stockpiles.

Rice costs prompted a variety of policy responses from across the world last week. Thailand, the world’s biggest rice exporter, said it has enough of the grain “for export to neighbouring countries.”

State banks in the Philippines, the world’s biggest rice importer, were told by the finance minister to earmark funds for grain purchases.

Hong Kong’s government said there is “no need for the public to worry” because the city has a “sufficient supply.”

China, the world’s biggest consumer of rice, said rising prices are not a concern in there.

Chinese premier Wen Jiabao said recently that the volume of rice traded on the world markets is less than one-tenth of that in the Chinese market.

To solve the looming crisis, China’s central government has taken a series of measures to promote agricultural production such as raising farm subsidies.

“China is capable of feeding itself with its own rice production,” said Wen.

In the United States, retail food prices rose four per cent last year, the biggest jump in 17 years, says the US Department of Agriculture.

The US is predicting another three-to-four per cent rise this year, with eggs, chicken, beef and fruit all beating inflation over the past year in terms of price increases. Since January 2005 the average price of a loaf of bread in the US has risen 32 per cent.

One of the main culprits in the rising food problem is the rush by Europe and the US to devote more farmland to growing biofuels – a dubious action to curb greenhouse gases.

In 2008, about 18 per cent of grain in the US will go to make ethanol and, according to the Earth Policy Institute, such production over the past two years could have fed nearly 250 million people.

UN officials are split over the high priority given to biofuels in the fight against climate change, with Secretary-General Ban Ki Moon now suggesting a review of that policy.

It is evident the situation may get worse before it gets better. Food riots signal the need to rethink global stability and the critical role of those who till the land and feed us all.

Rising food prices in our own grocery stores will serve as heady reminders.

 Juliann Fraser is a writer living in Whitehorse.

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