Food Price Volatility And Its Effects On Low-Income Households

This article analyzes how food price volatility affects low-income households and why suchhouseholds experience stronger welfare losses than middle- and high-income groups. The study uses anIMRAD structure and combines conceptual analysis with selected empirical evidence from FAO, the WorldBank, USDA, Eurostat, and Canada.ca/Statistics Canada-based estimates. The results show that low-incomehouseholds are highly exposed to food price volatility because food constitutes a larger share of their budgets,their savings are limited, and they have less flexibility to substitute toward higher-quality goods. Recent evidenceconfirms that food insecurity persists even in developed economies: in 2024, 13.7 percent of U.S. householdswere food insecure; in the European Union, 8.5 percent of the population could not afford a proper meal everysecond day; and in Canada, 25.5 percent of people in the provinces and 37.4 percent in the territories lived infood-insecure households. The article argues that food price stability is not only a macroeconomic objective butalso a social-protection priority. The most effective response combines inflation monitoring, targeted transfers,competition policy, resilient supply chains, and nutrition-sensitive public policy.