There has been a steady increase in the international price of food, but from 2007-2008, and in 2009, there were a huge increases in the prices for rice and other labor intensive crops. This was due to a mixture of a shortage of rice and biofuels.
Speculation on the biofuels market lead to a devastating increase in crops which carried over to the transportation/shipping industries as well. The increase of oil prices and the decline of the US dollar on the currency market also contributed to an increase in world market food prices.
Though there is not a direct link to speculation and biofuels raising the price, it was a chain of events (oil prices, rice shortages, and speculation on a failure) that caused the catastrophic increases.
References:
http://www.voxeu.org/index.php?q=node/1437
www.answers.com/topic/food-supply-and-the-global-food-market
http://www.stanford.edu/group/FRI/indonesia/documents/foodpolicy/chapt4.fm.html
http://www.marketoracle.co.uk/Article8573.html
Friday, May 21, 2010
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