Spike in food prices worsens East African famine

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It's the hidden factor in the Somalia famine: not just drought and civil war, but the quiet hand of the marketplace in triggering a painful rise in food prices for millions of vulnerable people.

The prices of local food staples in Somalia have soared by up to 240 per cent in the past nine months, exceeding their record highs of 2008 and contributing to a worsening of the humanitarian disaster in the country, the World Bank says in a new report.

Around the world, food prices remain high this year, it says, with dangerous escalations in local markets across the famine-stricken Horn of Africa, including Ethiopia and Kenya as well as Somalia. The rapidly rising prices in East Africa have already sparked a wave of street protests and political unrest in countries such as Uganda and Kenya.

Prices for staples such as maize are also increasing sharply in Central and South America, in countries such as Colombia, Honduras, Guatemala and the Dominican Republic, the report says. But it singled out the Horn of Africa for most of its concern.

"Nowhere are high food prices, poverty and instability combining to produce tragic suffering more than in the Horn of Africa," World Bank president Robert Zoellick said in a statement Monday.

While global food prices in July were down slightly from their latest spike in February, they remained 33 per cent higher than a year ago, and close to their 2008 peak, with global food stocks still "alarmingly low," the report said. Food production has become more expensive because of a 45 per cent rise in crude oil prices and a 67 per cent rise in fertilizer prices.

The global price of maize, an essential food staple in many countries, has climbed by 84 per cent in the past year – including increases of more than 100 per cent in East African cities such as Kampala, Mogadishu and Kigali.

"Persistently high food prices and low food stocks indicate that we're still in the danger zone, with the most vulnerable people the least able to cope," Mr. Zoellick said. "Vigilance is vital given the uncertainties and volatility that exist today. There is no cushion."

The dramatic rise in food prices over the past year have already meant that an additional 44 million people have been thrown into poverty in developing countries, according to estimates released in February.

In Somalia, the famine has killed more than 29,000 children in the past three months, and a further 640,000 children are acutely malnourished, the United Nations says.

A report on Monday by the Associated Press revealed that market vendors in Mogadishu are illicitly selling thousands of sacks of food aid that were intended for Somali famine victims. As much as half of all aid deliveries are being stolen and sold in the market by unscrupulous businessmen, a government official told the AP.

The UN's food agency, the World Food Program, said it is investigating the report of stolen aid, but it said it cannot suspend the flow of aid shipments to Somalia while the investigation is under way because of the scale of the famine.

Humanitarian supply lines in Somalia are "highly vulnerable to looting, attack and diversion by armed groups," the agency said in a statement on Monday.

"WFP condemns all parties who would use the desperation of the hungry in Somalia to block, attack, or divert live-saving humanitarian supplies for their own benefit," the agency said.

"WFP could consider suspending distributions while the investigations take place, but doing that in Somalia right now would lead to many unnecessary deaths. The scale and intensity of the humanitarian crisis simply does not allow for a suspension of food assistance."