Exploding Food Prices Strain World Economy

The World Bank estimates that as many as 33 countries are on the verge of social meltdown as exploding rice prices unravel the socio-economic fabric of several nations. Rice prices have more than doubled in the last year and have jumped 2.4% today in Chicago on speculation that demand would continue to outstrip supply. In a statement on the World Bank’s website, the body’s President Robert Zoellick insisted that “there is no margin for survival.” Bloomberg reports:

China, India and Vietnam have cut rice exports, and Indonesia has reduced import tariffs to protect food supplies and cool inflation. Rice in Chicago climbed 42 per cent in the first quarter, the biggest such increase in at least 14 years. Record grain prices contributed to strikes in Argentina, riots in Ivory Coast and a crackdown on illicit exports in Pakistan.

Rough rice for May delivery advanced to $20.26 per 100 pounds on the Chicago Board of Trade today as the United Nations’ Food and Agriculture organisation said global exports will drop 3.5 per cent this year as nations curb sales.

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