What was the main cause for the price of food to skyrocket?

A	This year Temporary Problems, such as the droughts in Russia and China or the floods in Canada and Pakistan, have been the main factor for the current skyrocketing of food prices.

B	Food Prices are on the rise because of speculation by investors leading to an increase in financial trading which causes prices to be more volatile

C	The main cause for the rise in the price of food is structural problems. Simply put, we are adding more people to the world at a faster rate than we are creating new food sources.

D	The reason the prices of food has gone up so much is because of the defunding of Agricultural Research.

E	All of the above contribute equally to the current spike in the prices of food.

In the last four years, we have now experienced two hikes in the price of food. Today, food prices are now higher in real terms than they have been since 1984 under the Ronald Reagan Administration. If China's wheat harvest is destroyed by the current drought, as is expected, food prices will spike even higher. If any more Middle Eastern Oil Producing countries become over-run with revolution, it will also cause an increase in the price of food because of the costs of the energy used from oil to harvest the food.

There are several reasons for the price of food to skyrocket. Those most often discussed are the following:

Temporary Problems: caused by things such as the current droughts in Russia, China, and Argentina or the floods in Canada and Pakistan.
Speculation: increased financial trading causing prices to be more volatile.
Structural Problems: example of this would be the growth of China and India; currently their own farmers are able to provide for their growth, but eventually local farmers won't be able to provide enough food for their growing populations. Generally speaking, the World's Population is growing faster than the yields of the World's most important crops, wheat and rice.
Decline in Public Spending on Agricultural Research: unlike most farm subsidies, basic agricultural research has been shown to work in keeping the price of food low. Afterall, the Green Revolution began with public research. The Green Revolution was a series of research, development, and technology transfer initiatives developed by Mexico between the 1940's and 1970's that increased agricultural production around the world. Western Countries have purposely cut back funding for studies conducted by International Institutions and Universities for Agricultural Research.

Of these four reasons often discussed as causing a worldwide spike in the price of food, which do you believe is currently having the largest impact?

Stephen James

What was the main cause for the price of food to skyrocket?

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