Food Price Inflation Set to Skyrocket

Friday, April 18, 2008 8:39 a.m. EDT

A huge and rapid rise in food prices is prompting poor food-producing countries to shut off exports — a decision which could make matters worse.
Indonesia, which imported 1.4 million metric tons of rice in 2007 and expected a bumper crop this year, has joined Vietnam, Egypt, India and China in banning rice exports. Other countries are holding back wheat.

The United Nations’ reports that global food prices surged 57 percent last month from a year earlier.

The World Bank estimates food prices have risen globally by 83 percent over the past three years. So far, the U.S. has been isolated — grocery prices here rose by just 5 percent last year.

Worldwide, cereal stockpiles are expected to fall to a 25-year-low of 405 million tons this year, down 5 percent from last year’s already low level.
Rice hit the $1,000-a-ton level for the first time ever this week the export restrictions, reports The Financial Times.

"Food prices, if they go on like they are doing today ... the consequences will be terrible," International Monetary Fund managing director Dominique Strauss-Kahn said during a recent conference on the problem.

"Hundreds of thousands of people will be starving,â€