Editor's Note: Though the droughts in the US and other parts of the world have a direct bearing on the price of grains and other foodstuffs, the relationship alone does not cause a 50% or greater rise in food prices as was witnessed in 2008 and is again being witnessed in 2012. The News of bad harvests leads to greater speculation in Commodities trading markets in Chicago, New York and across the Atlantic in London and other European financial centers. It is speculation that causes most of the price hikes; these price hikes take pennies out of the pockets of the poorest people in the world to make excessive profits for commodities speculators. Such speculation is truly speculating in the lives of the weakest and poorest peoples of the world. So to stabilize grain and food prices, the first thing that needs to be done is to stop commodities trading, rather speculating to make ungodly profits for a few at the expense of the many. Will such an outcome ever be seen? I highly doubt it for Wall Street and the City of London fill the coffers of politicians to do their bidding; the destitute poor have a tough enough time buying enough food for a subsistence level existence, they have no means of buying off politicians. This is one of the most evil activities on the planet yet people engage in it without conscience for the sake of filthy lucre. And few stop and consider the plight of the weakest and the poorest as long as their grocery stores are well stocked and their fridges are full.
A mix of high oil prices, growing use of biofuels, bad weather, soaring grainfutures markets and restrictive export policies pushed up prices of food in 2007/08, sparking violent protests in countries including Egypt, Cameroon and Haiti.
Concern about extreme hot and dry weather in the U.S. Midwest sent corn and soybean prices to record highs last month, driving overall food prices higher again and reversing the Food and Agriculture Organisation's forecast for declines this year.
"There is potential for a situation to develop like we had back in 2007/08," the FAO's senior economist and grain analyst Abdolreza Abbassian told Reuters.Read More: Potential grows for food crisis as prices surge: U.N. | Reuters