Food Security And Agricultural Development In Times Of High Commodity Prices

The paper provides a new perspective on rising food prices by out mapping the many complex ways in which higher food prices are affecting developing countries, in particular the poorest. The analysis presented herein develops important and differentiated policy implications by distinguishing not only between implications in the shot run and medium run, and challenges on the supply side and demand side, but also between countries with agricultural potential and countries without such potential. Although globally food security is a challenge on both the demand side and the supply side, the paper argues that not all countries can effectively address this challenge from both angles. Furthermore, while higher food prices can provide important stimulus for agricultural development, it should not be expected that agricultural output will automatically rise in response to price changes, as higher prices in international markets are frequently not passed through to producers, and as many producers lack the capacity to respond to positive price signals where they are passed on. Both failures bear important implications for policies to address the dual challenge of food security and agricultural development.