Guess What: Food Prices Still Near All-Time Highs

The FAO Food Price Index (FPI) remains at near record-highs, and this at a time when record droughts and calamitous famine threaten the Horn of Africa. Using the latest data from the FAO FPI page, I plot here the FPI time series from 1990-2011.

fpi-ts-1990-2011-1

World food prices are high and have remained so since the beginning of this year, though there have been some pretty dramatic swings between 2008 and now.  There is some argument that the real problem for poverty alleviation is actually price volatility and not high prices per se.  However, a recent paper in Foreign Affairs by Barrett and Bellemare argues that the problem for the world’s poor is really high prices (a more complete working paper can be found here). I find their arguments quite persuasive. Among these, the authors wryly note “Perhaps not coincidentally, [commentators’ and politicians’] emphasis on tempering price volatility favors the same large farmers who already enjoy tremendous financial support from G-20 governments.”

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