Why are food prices rising ?

The Economist's Food price index has increased 60% in the last year, mainly driven by increased prices for the world's 3 big cereal crops ... corn, wheat and rice. It would be easy to just blame it all on biofuels, but I think there are several more reasons:

* Increased energy prices... this makes the cost of running farm equipment & transporting the harvest much more expensive & also increases the cost of producing fertilizer. Natural gas is a key fertilizer input & this has had large price increases also ... which is linked to increased energy.

* Increased demand for food ... particularly from China and India. The diets of these countries is also changing towards more meat and dairy ... which are more expensive and require a lot more crops as feed, which drives up the price of corn & wheat.

* Increased drought (Australia & Southern Europe) in some areas has reduced crop harvests ... increased flooding in other areas has decreased harvests (UK). Climate change could be contributing to this.

* Increased demand for crops for biofuels ... although this is only one of many factors.