Following our workshop on food price volatility on 6 February 2012, three participants have reflected on the big debates: why it matters, who is to blame and what should be done.

Stephen Spratt, Research Fellow in the Institute of Development Studies, sums up the key debates in a piece for the IDS website:

“Many factors may contribute to high prices (e.g. climate change, rising demand from the BRICs, high oil prices or reduced supply due to biofuel mandates) and to high volatility (e.g. unpredictable harvests, exchange rate shifts or low levels of global food stocks).Separating out the impact of any one cause is fiendishly difficult, so most stress a role for all these factors.

Financial speculation is different. Here one group points an accusing finger, while their opponents see speculators as entirely innocent.”

Lawrence Haddad, Director of the Institute of Development Studies, who chaired the final session of the day, lists 7 big questions addressed at the workshop:

“…The meeting helpfully unpacked a lot of the questions.

1. Food price spikes — are we talking about food price levels or volatility? They tend to go hand in hand, but they have two different effects.

2. Which components of volatility do we care most about? Predictable or unpredictable components? The latter.

3. Is FPV going up or down? We had papers that said it had never been higher, and some that said it was lower than in the 1970s. Not much consensus there.”

“…Prior to the workshop I was not convinced that volatility was the primary problem in agricultural markets. It seems to me that there is a lot of confusion between the impact of high food prices and the impact of volatile prices. Some of the evidence presented seemed to mix both effects:

with high prices, net-producers should benefit, and net-consumers should lose out; with volatile prices, the impact on net-producers is clearly negative, but the impact on net-consumers is unclear.”

Xavier’s full post is on the IDS Globalisation and Development blog.