Global food prices are rising, and the World Bank predicts price volatility will last for 5 years
Nowadays, many people have this feeling: nothing in the vegetable market is cheap, and 100 yuan does not buy much.
On the 25th, the British newspaper The Guardian reported under the title "Prices Have Peaked, a Global Food Crisis Can Be Foreseen," saying that grain and vegetable prices are not yet at their highest, and will reach their peak within the next two years, and that a global food crisis can already be foreseen now.
The World Bank estimates that price volatility in major foods such as meat, sugar, rice and wheat will continue for 5 years, and has asked developed countries to prepare relief funds for a global food crisis.
Basic foods are rising in price worldwide
Recently, news of soaring prices for daily necessities and food has been endless. Garlic can sell for 25 yuan per kg, and a single napa cabbage in South Korea once sold for about 100 yuan……
According to data from Jefferies Financial Group, part of the Reuters Group, within just a few weeks recently, global wheat and corn prices rose by nearly 30%, while meat prices reached their highest point in 20 years.
Last week, the United States predicted that compared with last year, global wheat output this year is down 30 million tons, a decline of 5.5%. At the same time, the prices of tomatoes in Egypt, garlic in China and bread in Pakistan are all close to record highs.
Over the past six months, global wheat and corn prices have already risen 57%, rice 45%, sugar 55%, and soybean prices have risen to their highest level in the past 16 months.
At present, global food prices have not yet reached the level of 2008. However, compared with last month, grain prices in the UK rose another 5%, reaching their highest level in two years.
Many scientists predict that because large-scale drought and flooding may occur in the coming year, grain and vegetable prices will rise to historic highs over the next two years.
Industrialization, urbanization, environmental degradation
Why is this happening? The answer from Olivier de Schutter, the United Nations special rapporteur on the right to food, is: environmental degradation, urbanization, and large amounts of land harvests being used to make biofuels.
"Worldwide, due to severe environmental degradation, 5 million-10 million hectares of farmland are lost each year, and due to industrialization and urbanization, 19.5 million hectares of farmland are lost each year," de Schutter said.
"In recent years, because industrial plantations have been widely promoted, the land has been continuously squeezed," de Schutter said. "According to the World Bank, more than 1/3 of land harvests are made into biofuels."
In addition, extreme weather is also a driving force behind the scenes. Generally speaking, both Russia and Pakistan have rather "abundant" grain reserves. But this year, an unrelenting heatwave in Russia triggered forest fires, and Pakistan suffered catastrophic floods, sharply reducing grain output in both countries. At present, the governments of Kenya, Uganda, Nigeria, Indonesia, Brazil and the Philippines have all warned that because of this year's drought or floods, extreme weather may continue next year, and combined with speculators hoarding goods, food shortages and price increases may be unavoidable.
Is a global food crisis imminent?
The Guardian says food is the first necessity of the people. Many countries may see unrest triggered by shortages of basic foods and rising prices. However, whether these current "price volatility signals" will trigger a global food crisis similar to that of 2008 has divided experts into two camps.
Some experts believe it will not trigger a global food crisis, but that for some time, high prices in the global daily necessities market are a certainty.
"A food crisis like that of 2008 will not come immediately, but the related explosive factors will remain latent all along. There are too many, too many differences between now and 2008. Harvests are larger, and global grain stocks are larger," said Chris Leather, a policy adviser at Oxfam in the UK. "Prices will always go up and down. The current market is a bit overly nervous."
Another group of experts supports the view that a global food crisis will occur in the near term. They also believe that food prices will trigger political unrest. They particularly point out that last month, because bread prices rose 30%, unrest broke out in Maputo, the capital of the African country Mozambique, and other places, causing 12 deaths.
Abdolreza Abbassian, a senior economist at the UN Food and Agriculture Organization, said, "In recent weeks, we have seen some of the same signs that led to the 2008 global food crisis. Our (food) prices may not be as high as in 2008, but this time, they will last longer."
Last week, the World Bank said that world food price volatility will continue for 5 years. In response to requests from developing countries, the World Bank has asked governments of developed countries to fund a 1 billion US dollar "food crisis fund."