News / Africa

Higher Wheat Prices Do Not Signal Another Food Price Crisis

Multimedia

Audio
Joe DeCapua

Despite a recent rise in the cost of wheat, food policy analysts are warning not to compare it to the food price crisis of 2007/2008.  The International Food Policy Research Institute (IFPRI) says “panic” over higher wheat prices is “baseless and could only hurt the poor.”

Concern has risen in some quarters because drought and wildfires have affected Russia’s wheat harvest.  The government has banned wheat exports into next year.

Maximo Torero, director of IFPRI’s Markets, Trade and Institutions Division, says, “It’s not an advocacy message.  It’s basically the reality.  The problem is there have been a lot of linkages between the 2007/2008 [crisis] with the current crisis.  And the situations are pretty different.”

How different?

“In this case, despite the problems of Russia and the reduction of supply in Russia and the closing of their borders in terms of exports of wheat, there are still sufficient grains available.  And there are also sufficient stocks, around 50 million metric tons more than 2007/2008,” he says.

What’s more, he says, “The prices of the other commodities, which in 2007/2008 were increasing substantially, have not increased at those levels, which mean corn and soybeans.  And also the price of oil is US$ 75 per barrel, which before was one hundred and thirty something.”

Make matters worse for the poor

An IFPRI statement says suggestions that the situation today and that of a few years ago are the same “serve to drive up food prices and hurt poor people, who spend much or most of their incomes on food.  They need neither jittery markets nor ad hoc protectionism, which has exacerbated past food crises.”

Torero says, “Calm down.  Because the problem is, if there is a lot of pressure through media or through news telling that we are in the same crisis as before, what could happen is that some countries could get into a nervous situation.  Internal politics could affect the situation.”

That could result in those countries following Russia’s example and imposing an export ban on wheat.  “And then, of course, that could create a problem,” he says.

IFPRI also points out that bad weather, which it calls a perennial wildcard in agriculture and commodity markets, has not affected all producers.

“In some countries, like in Russia, we had a problem.  But in others, we’re having a bumper harvest, like in the case of the U.S.,” he says.  Australia and Canada are also having good wheat harvests.

“So, we don’t see weather affecting all at the same time,” Torero says.  And while Pakistan has been hit by floods, the harvest had already been collected and stored.  “What has been lost on one side can be compensated (for) on the other side.”

Mozambique

Mozambique recently experienced riots following a sharp rise in food prices.  But Torero says it’s “another example of how things get distorted.”

He adds, “What happened in Mozambique basically was a response of the government increasing control prices – prices that were fixed by the government, not fixed by the market – in a significant amount.”

The government action affected the price of such things as electricity, water and bread.

“It had nothing to do with what happened… at the global level.  The reasoning behind [the price hikes] is there was a significant devaluation with respect to the currency in South Africa, from the metical [Mozambican currency] to the rand, which was huge,” he says.

The devaluation of the metical hit the country hard because Mozambique imports much of its goods from South Africa.  Nevertheless, many assumed the situation stemmed from higher wheat prices.

“It was completely linked to the food crisis and those kinds of things don’t make, honestly, too much sense,” he says.

You May Like

Cambodia Seeks Official UN Maps for Vietnam Border

Notice of request comes as 2 countries open border talks Tuesday after a clash last month More

From South Africa to Vietnam, Cyclists Deliver Message Against Rhino Horns

Appalled by poaching they saw firsthand, sisters embark on tour to raise awareness in countries where rhino horn products are in demand More

Uber Wants Johannesburg Police Protection

Request follows recent protests outside ride-hailing service's Johannesburg office More

This forum has been closed.
Comments
     
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
New Implant Could Help Restore Movement to Paralyzed Limbsi
|| 0:00:00
...    
🔇
X
Maia Pujara
July 07, 2015 10:01 PM
A half-million people suffer spinal cord injuries each year because of car accidents, serious falls and diseases, according to the World Health Organization. Researchers are now working on a soft but strong spinal cord implant that could one day restore movement in paralyzed individuals. VOA’s Maia Pujara reports.
Video

Video New Implant Could Help Restore Movement to Paralyzed Limbs

A half-million people suffer spinal cord injuries each year because of car accidents, serious falls and diseases, according to the World Health Organization. Researchers are now working on a soft but strong spinal cord implant that could one day restore movement in paralyzed individuals. VOA’s Maia Pujara reports.
Video

Video Getting it Done Beyond a Nuclear Deal

If a nuclear deal is reached between Iran and world powers in Vienna, it will be a highly technical road map to be used to monitor nuclear activity in Iran for years to come to ensure Tehran does not make nuclear weapons. Equally as complicated will be dismantling international sanctions that were originally intended to be ironclad. VOA’s Heather Murdock talks to experts about the key challenges any deal will present.
Video

Video Rice Farmers Frustrated As Drought Grips Thailand

A severe drought in Thailand is limiting the growing season of the country’s important rice crop. Farmers are blaming the government for not doing more to protect a key export. Steve Sandford reports from Chiang Mai, Thailand.
Video

Video Making Music, Fleeing Bombs: New Film on Sudan’s Internal Refugees

In 2012, Sudanese filmmaker Hajooj Kuka went to make a documentary among civil war refugees in Sudan’s Blue Nile and Nuba Mountains region. What he found surprised him: music was helping to save people from bombing raids by their own government. VOA’s Carolyn Weaver has more.
Video

Video 'From This Day Forward' Reveals Difficult Journey of Transgender Parent

In her documentary, "From This Day Forward", filmmaker Sharon Shattuck reveals the personal journey of her transgender father, as he told his family that he always felt he was a woman inside and decided to live as one. VOA’s Penelope Poulou has more.
Video

Video Floodwaters Threaten Iconic American Home

The Farnsworth House in the Midwest State of Illinois is one of the most iconic homes in America. Thousands of tourists visit the site every year. Its location near a river inspired the design of the house, but, as VOA’s Kane Farabaugh reports, that very location is now threatening the existence of this National Historic Landmark.
Video

Video Olympics Construction Scars Sacred Korean Mountain

Environmentalists in South Korea are protesting a Winter Olympics construction project to build a ski slope through a 500-year-old protected forest. Brian Padden reports that although there is strong national support for hosting the 2018 Pyeongchang Winter Olympics, there are growing public concerns over the costs and possible ecological damage at the revered mountain.
Video

Video Xenophobia Victims in South Africa Flee Violence, Then Return

Many Malawians fled South Africa early this year after xenophobic attacks on African immigrants. But many quickly found life was no better at home and have returned to South Africa – often illegally and without jobs, and facing the tough task of having to start over. Lameck Masina and Anita Powell file from Johannesburg.
Video

Video Family of American Marine Calls for Release From Iranian Prison

As the crowd of journalists covering the Iran talks swells, so too do the opportunities for media coverage.  Hoping to catch the attention of high-level diplomats, the family of American-Iranian marine Amir Hekmati is in Vienna, pleading for his release from an Iranian prison after nearly 4 years.  VOA’s Heather Murdock reports from Vienna.
Video

Video UK Holds Terror Drill as MPs Mull Tunisia Response

After pledging a tough response to last Friday’s terror attack in Tunisia, which came just days before the 10th anniversary of the bomb attacks on London’s transport network, British security services are shifting their focus to overseas counter-terror operations. VOA's Henry Ridgwell has more.
Video

Video Hate Groups Spread Influence Via Internet

Hate groups of various kinds are using the Internet for propaganda and recruitment, and a Jewish human rights organization that monitors these groups, the Simon Wiesenthal Center, says their influence is growing. The messages are different, but the calls to hatred or violence are similar. VOA's Mike O’Sullivan reports.
Video

Video Blind Somali Journalist Defies Odds in Mogadishu

Despite improving security in the last few years, Somalia remains one of the most dangerous countries to be a journalist – even more so for someone who cannot see. Abdulaziz Billow has the story of journalist Abdifatah Hassan Kalgacal, who has been reporting from the Somali capital for the last decade despite being blind.

VOA Blogs