U.S. Relations With the People's Republic of China (2008)

The White House

For Immediate Release
Office of the Press Secretary
May 1, 2008

Fact Sheet: Leading the Fight Against Hunger

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The Increase In Global Food Prices Results From A Variety Of Factors

Increased production of corn-based biofuels is estimated to account for only three percent of the 43 percent increase in global food prices. U.S. food prices have increased far less than global food prices and a similarly small percent of the increase is attributed to biofuels production. Without increased ethanol production, food price inflation in the United States would have been 4.25 percent over the past 12 months rather than 4.5 percent. One of the reasons U.S. food prices have increased less than global food prices is because Americans consume more processed and restaurant foods, while developing countries consume more basic commodities. The spike in commodity prices directly impacts the global food price.

Several other factors have contributed to the increase in global food prices. These include increased demand in rapidly growing emerging economies; rising energy costs, which increase the cost of agricultural production and delivering products to consumers; several years of bad weather in Australia, China, and parts of Eastern Europe, which have hit wheat harvests especially hard; export restrictions imposed by several countries, some with significant commodity stocks; and, to some extent, increased biofuel production.

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