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G20 plans meeting to discuss rising food prices
As farmers struggle with drought, government officials will meet to coordinate a response to the increasing costs of corn and other crops.
Mon, Aug 13 2012 at 5:26 AM
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The Group of 20 top economies will meet shortly to try and coordinate a response to soaring food prices, driven by drought and rising demand, the Financial Times reported Monday.
Over the weekend, U.S. President Barack Obama called on Congress to help farmers struggling with the worst U.S. drought in half a century. The U.S. Department of Agriculture has warned of sharply rising crop prices.
The USDA said corn prices could hit $8.90 a bushel, up sharply on its July estimate, with soybean at up to $15-17 a bushel, $2.00 more.
Record temperatures in July left both crops badly damaged, pushing yields per acre for corn to the lowest level since 1995 and, for soybeans, the lowest since 2003, it said.
The Financial Times said concerns over the U.S. harvest had prompted senior G20 and United Nations officials to consider an emergency meeting on food supply, with a conference call on the issue scheduled for Aug. 27.
The newspaper cited officials as saying the talks were not a sign of panic but rather reflected the need to establish a consensus so as to avoid a repeat of the riots and tensions sparked in 2007-08 by a spike in food prices.
The Financial Times reported Friday that the head of the UN's Food and Agricultural Organization had urged the United States to suspend its biofuel production programmes so as to ease the pressure on food resources.
The FAO said last week that global food prices rose 6.0 percent in July after dropping for three months, largely because of a hike in grains and sugar.
Copyright 2012 AFP Global Edition
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Suspending US corn based biofuel production is a good idea. 40% of a normal crop goes to biofuel. The percentage will be higher with the reduced crop. Since the resulting biofuel actually requires more energy to produce than there is in a gallon, maybe its time to sideline this program.