Price Volatility in the Food Markets
19 Pages Posted: 23 May 2015
Date Written: July 18, 2011
Food price volatility has spiked to levels last seen in the 1970s. For low-income countries, food price hikes, such as have occurred recently, tend to significantly increase the incidence of intra-state conflicts, according to IMF research. The 2007-2008 food crisis, and the resumption of more recent food price spikes, clearly have a number of causes. That said, in reviewing over a century of commodity price volatility, there are episodes of low volatility and high volatility, which would indicate that this may be a pattern of recurrent phenomena. As a result, it may be wise to focus on how to manage price volatility rather than believe that this phenomenon can be eradicated.
Keywords: food price volatility, commodty, agriculture, futures market, speculation, hedging
JEL Classification: G1, G18, Q11, Q18
Suggested Citation: Suggested Citation