2007–2008 world food price crisis

World food prices increased dramatically in 2007 and the first and second quarter of 2008, creating a global crisis and causing political and economic instability and social unrest in both poor and developed nations. Although the media spotlight focused on the riots that ensued in the face of high prices, the ongoing crisis of food insecurity had been years in the making. Systemic causes for the worldwide increases in food prices continue to be the subject of debate. After peaking in the second quarter of 2008, prices fell dramatically during the late-2000s recession but increased during 2009 and 2010, peaking again in early 2011 at a level slightly higher than the level reached in 2008. However a repeat of the crisis of 2008 is not anticipated due to ample stockpiles.

The initial causes of the late-2006 price spikes included droughts in grain-producing nations and rising oil prices. Oil price increases also caused general escalations in the costs of fertilizers, food transportation, and industrial agriculture. Root causes may be the increasing use of biofuels in developed countries (see also food vs fuel), and an increasing demand for a more varied diet across the expanding middle-class populations of Asia. The Food and Agriculture Organization also raised concerns about the role of hedge funds speculating on prices leading to major shifts in prices. These factors, coupled with falling world-food stockpiles, all contributed to the worldwide rise in food prices.

Between 2006 and 2008 average world prices for rice rose by 217%, wheat by 136%, corn by 125% and soybeans by 107%. In late April 2008 rice prices hit 24 cents (US) per US pound, more than doubling the price in just seven months.

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