Rising food prices curb aid to global poor

Food commodity prices have risen by 21 percent since 2005, which will stretch aid groups' resources.

By Mark Trumbull | Staff writer of The Christian Science Monitor

from the July 24, 2007 edition

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Rising food prices are threatening the ability of aid organizations to help the world's hungriest people.

Worldwide, basic foods now cost 21 percent more at the wholesale level than in 2005, with key commodities such as grains and oils up more than 30 percent, according to World Bank price indexes.

For poor people, that means the quality and quantity of nutrition are at risk. For relief organizations, it means aid resources are stretched thin.

Typically, donor governments boost their food-relief funding when a crisis demands it. What's happening now is not so much a crisis as a quiet squeeze.

"It's both the rising food prices and the rising cost of freight…. It definitely is affecting what we're able to provide" to people in need, says Lisa Kuennen-Asfaw, a food aid expert at Catholic Relief Services in Baltimore. This year, she says, "every one of our programs has received a little bit less [food] than what they expected."

Retail food prices haven't spiked as much as wholesale prices. But for both aid groups and people in developing nations, the costs have generally been rising. Experts cite several main reasons:

•Growing demand for grains as biofuels is pushing up the price of grains for human and livestock food.

•The success of India and China in lifting millions of their people out of poverty has increased global demand for higher-value foods.

•Rising food demand worldwide has worn down inventories. Stocks of wheat sit at 30-year lows.

•The jump in oil prices since 2004 has rippled into various food-related costs: fertilizer, refrigeration, transport.

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