Soaring food prices and the rural poor: feedback from the field

The prices of basic food commodities have increased rapidly over the past three years and, as a result, the threat to food security in developing countries has increased significantly.&nbsp;This paper by the International Fund for Agricultural Development (IFAD),&nbsp;examines what soaring food prices at the global level mean for poor rural people across the developing world. A questionnaire was sent out to IFAD&rsquo;s Country Programme Managers, Country Presence Officers and other colleagues, with a request that they provide information on the impact of rising food prices on poor rural people in their countries. Within a week, responses were received for over 40 countries, from all five IFAD regions. This paper has been compiled on the basis of these inputs. Key points raised from the responses received are: the food crisis is real, and it is affecting poor rural people across the developing world in virtually all countries, food prices have increased in 2007 and early 2008. The extent to which they have increased varies considerably country by country, and indeed within countries, from 10-20 per cent to 200 per cent. Consumer prices have typically increased to a greater degree than producer prices the factors behind the increased prices include higher input costs, higher transportation costs (both a consequence of increasing fuel prices), in a few countries civil unrest, and above all, agro-climatic conditions. Floods, droughts and frosts led to substantial increases in prices in many countries poor rural people, many of whom are absolute or net food buyers, are losing out and are becoming poorer as consumers, they are responding by reducing the quantity they eat, and are shifting to lower costs &ndash; and in some cases lower quality &ndash; foods. There are suggestions from a number of countries that malnutrition is on the rise as producers, they are responding either by withdrawing from the market and reverting to low-input low-output production, for home consumption; or, where they are able, by shifting into higher value market-oriented production, as a means to earn the income to assure their food security others in the rural economy are reacting to increased market opportunities, and in a number of regions &ndash; above all Latin America &ndash; land ownership is becoming increasingly concentrated. The rural poor are already losing out in some cases to date, government responses to rising food prices have been principally short-term and aimed at urban consumers. A number of countries have also introduced measures aimed at stimulating increased market supply. Yet poor rural people risk being excluded from both. <br /><br /><br /><br />