WASHINGTON, D.C.—A new USDA report reveals world market prices for major food commodities such as grains and vegetable oils have risen sharply to historic highs of more than 60 percent above levels just two years ago.
According to the report, many factors contributed to the increase in food commodity prices including increased global demand for biofuels feedstocks and adverse weather conditions in 2006 and 2007 in some major grain and oil seed producing areas; the declining value of the U.S. dollar; rising energy prices; increasing agricultural costs of production; growing foreign exchange holdings by major food importing countries; and policies adopted recently by some exporting and importing countries to mitigate their own food price inflation.
