Frederic Mousseau, OI Policy Director, is the author of the Chapter III of the new World Disaster Report published by the International Federation of Red Cross and Red Crescent Societies (IFRC). This new report warns that the world's poorest people are at serious risk from rocketing food prices and volatile global markets.
The Chapter III, Continued Price Instability Questions Reliance on Global Food Markets outlines the impact of price volatility on food insecurity and hunger. It argues that higher food prices can be explained by a number of intertwined factors such as slowing growth in food production, lower stock levels, increased use of agrofuels, and growing commodity and financial speculation. In contrast, increased demand from emerging economies like China and India is not a major factor in explaining higher food prices.
Against the background of powerful forces at play in today's globalized world, a number of realistic measures are highlighted and suggestions made for coping with price instability. These include government measures to limit domestic inflation and the neglected and often crucial role of remittances and safety nets. Food aid programs and the ability of the global food market to supply sufficient and cheap food must be viewed with skepticism. Rather, the way forward lies in regulation, social protection and increased food production.