A soaring food price has swept the world and presented a gloomy picture for people, especially those from poor countries.

PRICE UP

Rice is displayed for sale at a whole-sale food market in Hanoi April 5, 2008.(Xinhua/Reuters Photo)

The food price hike virtually started from 2002, but accelerated during the past few years, especially since August, 2007. In year 2007 alone, international grain price soared by 42 percent.

A latest report by the World Bank showed that wheat price on the international market has jumped 181 percent during the past three years, and food price surged 82 percent in general.

The surge in prices has been led primarily by dairy and grains, but prices of other commodities, with the exception of sugar, have also raised significantly.

Along with the price hike comes shrinking grain stocks worldwide. According to UN's Food and Agriculture Organization (FAO), the current world food reserve has dropped to the lowest level since 1980.

REASONS

It's widely believed that natural disasters, a growing demand for food worldwide, coupled with market speculation, surging oil prices, and the expansion of bio-fuels, are pushing the food price up.

The UN Environment Program said the planet's water, land, air, plants, animals and fish stocks were all in "inexorable decline." According to the UN's World Food Program (WFP), 57 countries, including 29 in Africa, 19 in Asia and nine in Latin America, havebeen hit by catastrophic floods. Harvests have been affected by drought and heat waves in south Asia, Europe, China, Sudan, Mozambique and Uruguay, according to a Guardian report.

A growing population also contributed to greater demand for food. According to Josette Sheeran, director of the WFP, "There are 854 million hungry people in the world and 4 million more join their ranks every year."

"We are facing the tightest food supplies in recent history. For the world's most vulnerable, food is simply being priced out of their reach," he said.

According to Japan's Economist magazine, after the U.S. subprime mortgage crisis triggered a turmoil on the international financial market, a huge amount of speculative funds has flowed into the less risky agricultural commodities futures market, pushing food price up along with oil, gold and other commodities.

High oil prices and the promotion of biofuels in many developed countries have further stimulated the surge of food price. The expensive oil has raised the cost of farm production in its various phases, such as crop growth and product transportation.

Biofuels directly consume crops such as maize. Some developed countries have encouraged the use and production of biofuels in recent years in a bid to reduce greenhouse gas emission and dependence on oil imports. The direct negative side effect is the reduction of staple food for human consumption, subsequently pushing the price up.

VietNamNet/Xinhuanet