Global food prices are an increasing cause for concern, given that rising prices have a widespread effect on economic welfare. As well as hitting the poorest, rising food prices worsen inflationary expectations, distort trade flows, and increase the likelihood of rising interest rates. Apart from a brief fall in food prices during the global recession, rising demand and tight supply conditions have pushes prices to record levels.
Each month the FAO publishes its food price index (FFPI), which tracks the prices of five selected foods, including cereals, sugar, oils and fats, dairy products and meat. The FAO also publishes a biannual report – the Food Outlook – which provides a detailed analysis of current and future market conditions.
The index clearly shows the effects of the global recession, which pushed food prices down during 2009. Since then food prices have returned to their upward trend. By 2011 the index of real food prices reached record levels, at 169. Between 2012 and 2016 real food prices fell, to reach an index value of 111 in 2016. During 2016, the nominal index aberaged 161.1, and by September 2017 it had risen to 176.6, with the real price index rising to 129.1 (Base period = 2002-2004).
See: Primary markets
Stagflation is a combination of high inflation, high unemployment, and stagnant economic growth. Because inflation isn't supposed to occur in a weak economy, stagflation is an unnatural situation. Slow growth prevents inflation in a normal ...
The laissez-faire economic theory centers on the restriction of government intervention in the economy. According to laissez-faire economics, the economy is at its strongest when the government protects individuals' rights but otherwise doesn't intervene. The ...
What Is Adverse Selection? Adverse selection is a term that describes the presence of unequal information between buyers and sellers, distorting the market and creating conditions that can lead to an economic collapse. It develops ...
Explaining The K-Shaped Economic Recovery from Covid-19 A K-shaped recovery exists post-recession where various segments of the economy recover at their own rates or levels, as opposed to a uniform recovery where each industry takes the same ...
Does Public Choice Theory Affect Economic Output? Both on paper and in real life, there is a solid relationship between economics, public choice, and politics. The economy is one of the major political arenas after all. ...
Largest Retail Bankruptcies Caused By 2020 Pandemic As we know at this point, the COVID-19 pandemic has thrown major companies in the US and the world over into complete havoc. Many have filed for bankruptcy, with an ...