World food prices hit record high

By Bryony Jones for CNN
February 3, 2011

London (CNN) -- World food prices rose to an all-time high in January, according to the United Nation's Food and Agriculture Organization (FAO).

The FAO's Food Price Index measures the cost of a basket of basic food supplies -- sugar, cereals, dairy, oils and fats and meat -- across the globe.
The index rose by 3.4% in January -- the seventh monthly increase in a row -- to its highest level since records began in 1990.

The cost of sugar, cereals, dairy and oils and fats all went up last month, while meat prices remained steady.
FAO economist Abdolreza Abbassian said high prices were likely to persist in the months to come.
Rising commodities costs are one of the major factors behind a growing wave of civil unrest across the Middle East and North Africa.

If prices remain high, it will be just a matter of months before the world's poor are hit by another major food price crisis
--Chris Leather, Oxfam

"High food prices are of major concern especially for low-income food deficit countries that may face problems financing food imports and for poor households which spend a large share of their income on food," said Abbassian.
Responding to the FAO's announcement, Oxfam said the latest price rises "should ring alarm bells in capitals around the world."

"If prices remain high, it will be just a matter of months before the world's poor are hit by another major food price crisis," said Chris Leather, the charity's policy advisor. Governments need to act now and act together to stop the rot.
"High global food prices risk hunger for millions of people. Poor people in developing countries spend up to 80% of their income on food. For them high food prices mean selling off their land or sacrificing their child's education simply to put food on the table."

Last week at the World Economic Forum in Davos, Switzerland, economist Nouriel Roubini warned that rapidly rising food prices posed a serious threat to global stability.

"What has happened in Tunisia and is happening right now in Egypt, but also the riots in Morocco, Algeria, Pakistan, are related not only to high unemployment rates and to income and wealth inequality, but also to the very sharp rise in food and commodity prices," he told CNN.