Rising food prices feed security concerns

Rising rice and global food prices have stoked food security concerns. In some places, that's led to protests and concerns that the escalating costs of staple foods may increasingly influence social and political stability.

Some Asian nations have taken action in the face of rising rice prices and debate over food security. India has restricted some rice exports, Indonesia has raised taxes on palm oil shipments, and Malaysia is building up rice stocks.

Rising global food prices have already caused political fallout; one analyst, in an United Press International editorial, says that Pakistan's food ration cards contributed to the unpopularity of President Pervez Musharraf.

In Asia this week, rice prices surged to a 20-year high in the latest sign of global food inflation. Governments are concerned that rice shortages will strain social cohesion, possibly leading to social unrest. Economists such as Nobel laureate Amartya Sen have described rice as a critical component of food and overall human security in developing countries in Asia. The rising prices may create policy challenges in Asia, reports the Financial Times.

Rice prices in Thailand, a global benchmark, rose last week above the level of $500 a metric ton for the first time since 1989, according to the United Nations Food and Agriculture Organization, pushing importing countries to seek assurances on supplies. Robert Ziegler, director at the International Rice Research Institute in Manila cautioned policymakers.

In the Philippines, consumer prices rose at the fastest pace in 16 months in February, driven by rising food prices, Bloomberg reports. Prices of rice, corn, pork, and cooking oil rose last month, according to the Filipino Bureau of Agricultural Statistics. Food prices accounted for half of the price rise.

Rising oil and food prices in the Philippines has led to overall cost of living increases that have driven nearly 4 million people back into poverty, Agence France-Presse reports. The number of Filipinos living on just a dollar a day rose from 23.8 million in 2003 to 27.6 million in 2006, according to a survey from the Economic Planning Ministry. Overall prices rose by 22 percent between 2003 and 2006.

The Philippines said Tuesday that it had called on Vietnam to guarantee rice shipments in a sign of rising global anxiety over how nations could feed their people, Reuters reports. Philippines' president, Gloria Arroyo, contacted Vietnamese Prime Minister Nguyen Tan to see if he could pledge an undisclosed supply of rice. Mrs. Arroyo appears to be the first leader to take an overtly political route to dispel the worries of her fast-growing population.

In China, Premier Wen Jiaobao told governments at all levels to provide a steady and adequate food supply to the country's 1.3 billion population, the state-owned People's Daily news service reported.

Mr. Wen added that although China's grain output rose four consecutive years to top 500 billion kilograms in 2007, last year's consumer price index rose by 4.8 percent.

In the United States, Arkansas rice producers are seeing record and near-record crop prices, reports the Ashley County Ledger. One agricultural economist said low worldwide stocks drove the high prices and demand for biofuel stocks – corn for ethanol and soybeans for diesel as well as higher global demand – spurred the low supplies.

On Monday, the US price of rice, a benchmark for the world's fourth-largest exporter of the grain, rose to a record $400 per metric ton – up about 75 percent in the past year, reports Financial Times.

The US Food and Agricultural Policy Research Institute's FAPRI 2007 US and World Agricultural Outlook forecasts a gradual decline in rice prices in 2008, but a steady rise over the next 10 years. The report is based on assumptions on the general economy, agricultural policies in the US and other nations, the weather, and technological changes.

These cost increases associated with use of food crops for fuel has been called agflation, according to The Economist.

The European Union responded to rising food costs on Tuesday with an announcement of its biggest-ever food aid package – €160 million ($243 million) – to help alleviate hunger in Africa, Asia, and the Middle East, reports Agence France-Presse.

The rising price of commodities has also affected US consumers, reports The Christian Science Monitor. The price of some types of wheat had nearly doubled over the previous four weeks alone. Rising food prices were hurting discretionary spending and making it difficult for the Federal Reserve, the US central bank, to balance rising inflation with a slowing economy.

The rising cost of another staple, corn, has also caused some North American protests. In Mexico City, the rising cost of tortillas – due to a 400 percent increase in corn prices – led tens of thousands of people to march in protest, reports the BBC.