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Urgent Measures Needed on Food Prices in Asia, Warns UN

A Cambodian man carries rice at a paddy rice farm in Bekpeang village, Kampong Cham province (FILE).

A Cambodian man carries rice at a paddy rice farm in Bekpeang village, Kampong Cham province (FILE).

The United Nations Food and Agriculture Organization says food prices in Asia remain high despite a brief drop in April.

According to the FAO, the retail cost of wheat and rice in Asia declined slightly last month, the first drop in nine months.

The price of rice, Asia’s staple, dropped two percent in Cambodia and Sri Lanka, and about half a percent in Bangladesh, it says. In India, the price of wheat declined seven percent.

The oil factor

But the FAO attributed the fall in food costs to a brief, sharp drop in the price of crude oil.

Despite the price drop in some places, the cost of rice from one year ago is still higher by 29 percent in Bangladesh, 25 percent in China and 40 percent in Vietnam and Laos.

The FAO's representative for the Asia-Pacific region, Hiroyuki Konuma, told reporters Wednesday that food prices across the region remain high and are hurting the poor most.

“So, negative impact of the retail price hike of food commodities, particularly of staple food like rice and wheat, it’s affecting the poor households which spend as much as 70 percent of their income for food,” Konuma said.

World food prices hit a record high in February as the cost of crude oil was driven up by political instability in the Middle East and North Africa.

The price of oil is closely linked to the price of food through transportation and processing costs.


Konuma says countries need to take urgent precautions to prevent a repeat of the 2008 food price crisis when costs of some staples doubled in a matter of months. He recommends countries establish social security nets for the poor and emergency food reserves.

“And, improving the availability of food security and market information. This is one of the factors that create unnecessary speculation and also panic buying,” he said.

The FAO expects about a two percent increase in rice production in 2011 but a slight decline in wheat production.

Despite rising prices, Konuma said food production is expected to meet global market demand but is still falling short of the U.N.’s Millennium Development Goal of halving the hunger rate by 2015.

The World Bank says since October rising food prices have pushed more than 40 million people into extreme poverty.