World Food Crisis - 1336 Words

Microeconomics H.W. Assignment World Food Crisis Professor: Student: 2011 Food is the foundation of human live and people cannot survive without it. Food security is a vital issue facing the governments around the world. However, food shortage is becoming increasingly severe in this day and age. There are several reasons which led to the universal food shortage and they are interconnected to each other. Increasing world population, extreme weather and the wide spread use of biofuels are the main causes of worldwide shortage of food. These factors lead to food price rises rapidly. Global food crisis is being compounded by several causes such as growing population,†¦show more content†¦But what happens if the U.S. scenario is worse than a â€Å"nonrecord† harvest? What if there’s a Russia-scale crop failure here at home? â€Å"When we have the first serious crop failure, which will happen,† says farm commodity expert Don Coxe, â€Å"we will then have a full-blown food crisis† – one far worse than 2008. Coxe has studied the sector for more than 35 years as a strategist for BMO Financial Group. He says it didn’t have to come to this. â€Å"We’ve got a situation where there has been no incentive to allocate significant new capital to agriculture or to develop new technologies to dramatically expand crop output.† â€Å"We’ve got complacency,† he sums up. â€Å"So for those reasons, I believe the next food crisis – when it comes – will be a bigger shock than $150 oil.† A recent report from HSBC isn’t quite so alarming†¦unless you read between the lines. â€Å"World agricultural markets,† it says, â€Å"have become so finely balanced between supply and demand that local disruptions can have a major impact on the global prices of the affected commodities and then reverberate throughout the entire food chain.† That was the story in 2008. It’s becoming the story again now. It may go away in a few weeks or a few months. But it won’t go away for good. It’ll keep coming back†¦for decades. There’s nothing you or I can do to change it. So we might as well â€Å"hedge† our rising food costs by investing in the very commodities whose pricesShow MoreRelatedWorld Food Crisis1328 Words   |  6 PagesMicroeconomics H.W. Assignment World Food Crisis Professor: Student: 2011 Food is the foundation of human live and people cannot survive without it. Food security is a vital issue facing the governments around the world. However, food shortage is becoming increasingly severe in this day and age. There are several reasons which led to the universal food shortage and they are interconnected to each other. Increasing world population, extreme weatherRead MoreWorld Food Crisis: Its Consequences and Underlying Problems1035 Words   |  5 Pagesthe World Food Crisis. As US Subprime credit and mortgage problems crunch harder into global national economies, Inflation is on sky rocket high. There is a surge in commodity prices particularly for food staples thus pushing up consumer prices across the globe. 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