According to press reports research from the International Food Policy Research Institute in Washington has warned that ‘if current plans for biofuel production by leading producers like the EU and USA are achieved, corn prices will increase by 26% by 2020’, but that prices could increase by 72% if ‘biofuels production exceeds these targets’.

Meanwhile the USDA is reporting bumper cereals crops in some regions, with South African production up by 3.7 million tonnes from last year at 11 million tonnes. Similarly the FAO is projecting a significant increase in world cereals production in 2008, although it is expected that cereal prices will remain at record levels, with dwindling stocks and continued strong demand. International wheat prices rose by 83% in the year to January 2008.

Low-income food-deficit countries saw a 2% decline in import volumes but a 35% increase in import costs of cereals. The increase in prices was even higher in Africa. In response to rising prices a range of policy measures have been adopted including: the lowering of import tariffs, the increasing of food subsidies and the banning of exports or imposition of export duties.