Two years ago, rocketing prices for agricultural commodities sparked food riots in the streets of some developing countries. Prices have been rising sharply again this year, especially for grains such as wheat. Last week, they shot up after Russia imposed an export ban on grains until the end of this year. Another food crisis does not look out of the question.
Not for nothing did Lenin once call grain the “currency of currencies”. Its price not only determines the cost of staples such as bread; it is also used as animal feed.
Russia’s ban – announced theatrically by its prime minister, Vladimir Putin – was blamed on droughts and fires that have ravaged some of its wheat-growing districts. These have depleted the summer harvest and may cause the winter crop to fail too. But while it is possible to sympathise with the Russian predicament, the ban is counterproductive. It is both a costly mechanism for protecting the welfare of less well-off Russians and makes a rerun of 2008 more likely.