This page contains a Flash digital edition of a book.
Summary


rom 2005 to May 2008, the international prices of major food cereals surged upward, in many cases more than doubling in the space of a few years, and in some cases—such as rice—more than doubling in the space of just a few months.1 Although food commodities are not unique in under- going such rapid price rises (energy and mineral prices have also surged), a sharp escalation in the price of basic foods is of special concern to the world’s poor. All poor people spend large portions of their household budgets on food, and most impoverished people depend on food production for their livelihoods but have very limited capacity to adjust quickly to sharp changes in relative prices. Consequently, surging food prices have caused panic and protest in developing countries and have presented the policymaking commu- nity with a challenge at least as severe as the 1972–74 global food crisis. This review of the 2007–08 food crisis attempts to provide a balanced and comprehensive assessment of the causes and consequences of the crisis for researchers and policymakers alike. This study was finalized in early 2010, about 18 months after international cereal prices peaked and then plum- meted, before rising again in 2009. It is therefore an appropriate point in time to reflect on the events of 2008 and the preceding years, reassess our understanding of the crisis (especially in light of the sharp drop in prices), and update the evidence on the impacts of the crisis with new data and fresh analysis. It is also an opportunity to emphasize to policymakers that food prices remain high by historical standards in both international and local markets, and that if higher prices in 2007 and 2008 were at least partly the result of fundamental pressures on international cereal markets, then it is reasonable to expect prices to remain high in the years to come (especially as economies recover from the financial crisis). Indeed, without actions to repair some significant flaws in the global food system, the food crises of 1972–74 and 2008 could be repeated, perhaps sooner rather than later. Regarding the causes of the 2007–08 crisis, this report aims to review the latest evidence in the literature, given that we have the luxury of more time


F


1 Much of this document builds on Headey and Fan (2008), although several sections are derived from additional work for the U.S. Agency for International Development (USAID), including Headey and Raszap Skorbiansky (2008) and Headey (2010). Moreover, the analysis presented in Headey and Fan (2008) is updated and extended in several important dimensions.


xii


Page 1  |  Page 2  |  Page 3  |  Page 4  |  Page 5  |  Page 6  |  Page 7  |  Page 8  |  Page 9  |  Page 10  |  Page 11  |  Page 12  |  Page 13  |  Page 14  |  Page 15  |  Page 16  |  Page 17  |  Page 18  |  Page 19  |  Page 20  |  Page 21  |  Page 22  |  Page 23  |  Page 24  |  Page 25  |  Page 26  |  Page 27  |  Page 28  |  Page 29  |  Page 30  |  Page 31  |  Page 32  |  Page 33  |  Page 34  |  Page 35  |  Page 36  |  Page 37  |  Page 38  |  Page 39  |  Page 40  |  Page 41  |  Page 42  |  Page 43  |  Page 44  |  Page 45  |  Page 46  |  Page 47  |  Page 48  |  Page 49  |  Page 50  |  Page 51  |  Page 52  |  Page 53  |  Page 54  |  Page 55  |  Page 56  |  Page 57  |  Page 58  |  Page 59  |  Page 60  |  Page 61  |  Page 62  |  Page 63  |  Page 64  |  Page 65  |  Page 66  |  Page 67  |  Page 68  |  Page 69  |  Page 70  |  Page 71  |  Page 72  |  Page 73  |  Page 74  |  Page 75  |  Page 76  |  Page 77  |  Page 78  |  Page 79  |  Page 80  |  Page 81  |  Page 82  |  Page 83  |  Page 84  |  Page 85  |  Page 86  |  Page 87  |  Page 88  |  Page 89  |  Page 90  |  Page 91  |  Page 92  |  Page 93  |  Page 94  |  Page 95  |  Page 96  |  Page 97  |  Page 98  |  Page 99  |  Page 100  |  Page 101  |  Page 102  |  Page 103  |  Page 104  |  Page 105  |  Page 106  |  Page 107  |  Page 108  |  Page 109  |  Page 110  |  Page 111  |  Page 112  |  Page 113  |  Page 114  |  Page 115  |  Page 116  |  Page 117  |  Page 118  |  Page 119  |  Page 120  |  Page 121  |  Page 122  |  Page 123  |  Page 124  |  Page 125  |  Page 126  |  Page 127  |  Page 128  |  Page 129  |  Page 130  |  Page 131  |  Page 132  |  Page 133  |  Page 134  |  Page 135  |  Page 136  |  Page 137  |  Page 138  |  Page 139  |  Page 140  |  Page 141  |  Page 142