Food Price Watch, May 2014: First Quarterly Increase Since August 2012; The Role of Food Prices in Food Riots
International food prices increased by 4 percent between January and April 2014, interrupting sustained declining trends in food prices observed since August 2012. Prices remain in sight of their all-time peak, some 16 percent below their historical record in August 2012.
International prices of wheat and maize increased sharply during the last quarter, in contrast with generally declining prices of rice. In the case of wheat, such a steep price increase has not occurred since the months leading to the historical peak in the summer of 2012.
Increasing weather concerns and import demand—and, arguably, to a lesser extent, uncertainty associated with the Ukraine situation—explain most of the price increases. These increases have taken place despite bumper crops in 2013 and continued projections of record grain harvests and stronger stocks expected for 2014.
Domestic prices saw their usual fluctuations, with grain prices remaining mostly stable between January and April 2014.
Weather concerns, political uncertainties, and currency fluctuations do not exist in a vacuum—as evidenced by this quarter’s global food price increase. Over the next few months, we must watch these prices carefully, making sure that any further increases do not put additional pressure on the least well-off around the world.
This issue also highlights the role that food price fluctuations can play in food riots. During the food price hikes of 2007 and 2008, dozens of violent episodes were reported across the world, and others have since followed.
Casualties associated with such episodes—popularly known as “food riots” (yet somewhat arbitrarily defined, as the report points out)—in Argentina, Cameroon, Haiti and India, to cite a few, made world headlines. There have been violent episodes also associated with low prices, such as those involving coffee producers in Vietnam (or cotton producers in Burkina Faso). These episodes remind us about the close relationship between food insecurity and conflict.
As a first step, it will be important to define and closely monitor food riots in order to prepare for them or indeed be in a better position to prevent them from happening in the first place.