Friday, May 23, 2008
World Food Prices To Stay High For Next 10 Years - At Least
A report coming out from the Organisation for Economic Co-operation and Development and the UN’s Food and Agriculture Organisation (FAO) will say that biofuel demand and developing countries like China have pushed food prices onto a "higher plateau," according to a Financial Times report:
“Food prices would be considerably higher in nominal terms than in the past but below the current records,” said an official familiar with the report. Compared with average prices for 2005-07, the report forecasts that in 2017 the price of wheat, adjusted for inflation, will be 2 per cent higher, rice 1 per cent higher and corn 15 per cent higher. Oilseed prices are expected to be up 33 per cent.In a separate report, the FAO said that people will have to get used to higher food prices, even though in the short term, prices will ease a bit from their record amounts. While the report acknowledges the current drop, it says that the overall cost increase won't go away any time soon. These reports do assume that the drive for biofuel won't be heading for a rest stop.
