Publication

This paper examines the reasons for the food price spike in 2007/08 and tries to draw some lessons from it. Ever since cereals prices began to rise rapidly on world markets in 2007, there have been attempts to explain the reasons why. Contrary to initial speculation and numerous media reports at the time, the authors contend that rising demand for foodstuffs in Asia was not a cause of the price spike. There is general agreement on many of the causes but more controversial factors as well. Understanding the causes of the price spike matters if the options for either preventing or mitigating future such events are to be assessed.