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| Title: | What's Driving Food Prices? March 2009 Update |
| Authors: | Abbott, Philip C.
Hurt, Christopher
Tyner, Wallace E. |
| Issue Date: | 2009-03 |
| Series/Report no.: | Issue Report |
| Notes: | In the spring and early summer of 2008, the temperature of the rhetoric in the food-versus-fuel debate was skyrocketing right along with the prices of corn, soybeans and
crude oil. Farm Foundation is not about heat or fueling fires. Our mission is to be a
catalyst for sound public policy by providing objective information to foster deeper
understanding of the complex issues before the food system today. We commissioned
Purdue University economists Wallace Tyner, Philip Abbott and Christopher Hurt to
provide a comprehensive, objective assessment of the forces driving food prices.
Released in July 2008, What’s Driving Food Prices? identified three major drivers of
prices—depreciation of the U.S. dollar, changes in production and consumption, and
growth in biofuels production. The three economists also reviewed more than two
dozen reports and studies in the academic and popular press about commodity prices,
biofuels and food prices, summarizing them in light of their own examination of the
facts.
Today, just eight months later, the landscape is remarkably different. The 2008/2009
crop production was higher than forecast, quieting talk of inadequate supplies.
Significant declines have occurred in crude oil, grain and oilseed crop prices. Biofuel
production has slowed. The value of the U.S. dollar has appreciated. A global financial
crisis and recession now dominate the news.
Given this remarkable reversal of conditions, we asked Tyner, Abbott and Hurt to reexamine
the drivers of food prices. Their analysis indicates that now, as eight months
ago, the answers are not simple. While the level of food prices has dropped, the forces
driving those prices remain the same today as in July 2008, as does the need to
understand how those forces work and interact.
As did the July 2008 report, this update reinforces the fact that food prices are
influenced by diverse and multiple factors generated by complex global economic
issues. It is the intent of Farm Foundation that the objective information provided in this
report will help public and private leaders better understand the functions of these
driving forces as they make business and public policy decisions for the future. |
| URI: | http://purl.umn.edu/48495 |
| Institution/Association: | Farm Foundation>Issue Reports |
| Total Pages: | 51 |
| Collections: | Issue Reports
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Files in This Item:
| File |
Description |
Size | Format |
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| FINAL 3-10-09 - Food Prices Update.pdf | | 1085Kb | PDF | View/Open |
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