G20 Targets High Food Prices

Posted June 23rd, 2011 at 1:25 pm (UTC-5)
Leave a comment

Twenty of the world's most important economies have agreed on measures aimed at controlling high and volatile food prices.

Meeting together for the first time, agriculture ministers from the G20 group of leading and emerging nations committed thermselves to increasing regulation of commodity markets.

They made plans to set up an emergency humanitarian food reserve and to share more information on food stocks and usage.

Critics say the G20's plan is short on specifics, and failed to act on one of the biggest contributors to high and unpredictable prices: the growing use of food crops to produce biofuels.

Global food prices have risen sharply in the past year as a string of bad weather has cut supplies of maize and wheat. The United Nations says food prices are likely to remain relatively high over the next decade because of demand from a growing and increasingly affluent population, high energy costs, and slowing global productivity gains.

Critics have blamed financial speculation in the commodity markets for increasingly volatile prices. The agreement recommends new controls on speculation, but final action on the recommendations is left to G20 finance ministers.

A severe drought in Russia touched off the sharp food-price increases over the past year. Experts say the situation worsened when Russia and other countries in the region banned exports.

The G20 agreement does not end those bans, as many had hoped, but sets up a rapid response forum for members to confer on actions.