Anyone who shops at a supermarket or follows world news knows that food prices have been going up. Here in the United States, higher food and energy prices have been driving inflation and contributing to record levels of hunger and food insecurity. According to a March report by the Bureau of Labor Statistics, food prices went up 2.9% in the last year. Of concern, healthier food eaten at home has increased by 3.6%, while less healthy food eaten away from home increased at about half the rate, only 1.9%. The cost of fresh vegetables rose by 4.7% in March and 6.7% in February. The cost of meats, poultry, fish and eggs were up by 7.9% over the past 12 months.
In other parts of the world the increases have been much higher. In mid-April, a World Bank report on its Food Price Index, a measurement of global food prices, showed that food prices had gone up 36% in the last year. Compared to a year ago, the price of corn is up 74%, wheat 69%, soybeans 36% and sugar 21%. These crops constitute the staple diet in many parts of the world and are also the basic ingredients that multinational food companies use to manufacture the energy dense and nutrient poor processed foods that they sell around the world. The Bank estimates that 44 million people have been driven into poverty since last June as a result of the price spikes. Since 2008, more than 130 million people have been pushed into extreme poverty by increases in the cost of basic commodities such as food and energy. After the 2008 food crisis and again in the last year, skyrocketing food prices have contributed to political unrest in Egypt, Tunisia, Haiti, China and elsewhere.
What are the causes of this surge in food prices and what are its public health consequences? What role has the food industry played? Most importantly, how can public health officials, activists and researchers contribute to an understanding of the health impact of rising food prices and inform policies that will reverse these increases or mitigate their effects? In a series of four reports over the next few weeks, I’ll examine these questions.
In this post, I discuss the reasons health professionals, researchers and activists should care about rising food costs. In the next post, I’ll briefly review the global, national and local factors that influence the supply and the demand for food, trying to sort out how these various forces interact to set the prices of both healthier and less healthy foods. In the third post, I’ll look more closely at two market influences on food prices: global and national speculation in food, which has grown significantly in the last decade, and the subsidies that governments offer various sectors of the food industry. I’ll also examine how the food industry has successfully externalized the consequences of unhealthy diets such as obesity and diabetes onto consumers and tax payers, allowing food prices to remain lower but amplifying the social and economic costs of food-related diseases. Finally, I’ll describe and analyze some of the strategies proposed to make healthy food more affordable.
The goal in these reports is to encourage public health professionals and food activists to consider the role of food prices in hunger, obesity and food related health conditions, and to make food prices a target for policy analysis and political action.
Consequences of Rising Food Prices
Changes in food prices influence health in a variety of direct and indirect ways, and of course have varying impacts on populations and nations of different economic levels. In both developed and developing countries, higher costs of basic foods drive poor people further into poverty and food insecurity, reducing the income available for other purposes such as housing, health care and education. In developed nations, most households spend on average 10-15% of their income on food while in developing nations this may increase to 70-80%. Thus food price is very much a class issue, affecting poor people and countries more than the better off.
In the United States today, increasing food prices travel in tandem with high unemployment, cuts in funding for safety net programs and a housing crisis that in the last two years has pushed more than 2 million Americans out of their homes. Thus, higher prices for food are only one component of rapidly deteriorating living conditions for a growing portion of Americans. According to a recent Census Bureau report, the poverty rate in the United States rose to 14.3% in 2009, the highest since 1994. A record 43.6 million Americans lived in poverty last year. Not surprising then that Feeding America, a national coalition of food support programs, last year gave food to 37 million Americans, including 14 million children, a 46 percent increase from 2006.
An important US and global trend is that on average prices for energy dense, nutrient poor processed foods (those high in fat, sugar, salt and calories) have declined or remained stable while prices for healthier foods such as fresh fruits and vegetables have increased. In the United States, for example, in the last 30 years the indexed cost of fruits and vegetables has increased by 40% while the cost for soda has declined by 20% . The table below shows unindexed changes for various food items, confirming that prices for healthy foods have increased far more than prices for less healthy ones. This trend contributes to increased consumption of unhealthy food and decreased consumption of healthier food, especially among poor people, thus exacerbating the already high disparities in food-related health conditions. In Mexico, NAFTA contributed to lower prices and wider availability of processed food imported from the US and declines in local agriculture, thus fueling epidemics of obesity and diabetes, especially among the urban poor and middle classes.
In theory, increasing food prices could lead some food outlets to substitute healthier, less expensive food for less healthy products. For example, according to the Wall Street Journal, Hardees and Carl’s Jr., two fast food chains owned by CKE Restaurants, have recently introduced turkey burgers, which are less expensive and have half the calories of beef burgers.But observers doubt whether most chains are ready to invest in the re-tooling needed for such changes or whether demand for healthier fare can compete with the taste for high fat meals supported by human evolution and billions of dollars in advertising. More commonly, fast food chains have responded to the economic crisis by promoting “value meals” that offer high calorie, fat, sugar and salt products at a discount.
Why Food Prices are a Public Health Priority
Few trends harm public health more than rising food prices. Both in the United States and around the world, higher food prices contribute both to hunger and food insecurity and to obesity and food-related chronic conditions, the world’s two greatest killers. Inadequate nutrition makes people more vulnerable to infectious diseases, still a major cause of death in the developing world. In both developed and developing countries, the greater increase in the cost of healthier food encourages more people to buy the high calorie, fat, sugar and salt products that are associated with global epidemics of diabetes, heart disease and some cancers. Without intervention, rising food prices will contribute to rising illness and death and growing disparities between better off and poorer populations and nations.
Some nutrition professionals shy away from making food prices a priority, given the multiple influences on the cost of food and the complexity of intervening in a meaningful way. But their importance to health makes this an untenable option. In the next post, I’ll examine these multiple influences and consider appropriate roles for markets and governments in setting food prices. Below, I suggest some sources for further reading on food prices and invite CHW readers to suggest others.
For More Information:
Andreyeva T, Long MW, Brownell KD. The impact of food prices on consumption: a systematic review of research on the price elasticity of demand for food. Am J Public Health. 2010;100(2):216-22.
De Schutter O. Food commodities speculation and food price crises. Briefing Notes 02, September 2010. United Nations Special Rapporteur on the Right to Food.
Kaufman F. The Food Bubble: How Wall Street Starved Millions and Got Away With It. Harper’s Magazine, July 2010, 27-34.
Schaffnit-Chatterjee C. Where are food prices heading? Deutsch Bank Research March10, 2011.
 US Department of Labor. Consumer Price Index Summary. March 2011. Washington, D.C., released April 15, 2011.
 World Bank. High and Volatile Food Prices Continue to Threaten the World’s Poor. Washington, D.C., April 14, 2011.
 DeNavas-Walt C, Proctor BD, Smith JC. U.S. Census Bureau, Current Population Reports, P60-238, Income, Poverty, and Health Insurance Coverage in the United States: 2009, U.S. Government Printing Office, Washington, DC, 2010.
 Feeding America. Hunger Study 2010.
 Drewnowski A. The cost of US foods as related to their nutritive value. Am J Clin Nutr. 2010;92(5):1181-8.
 Putnam J, Allshouse J, Kantor LS. U.S. Per Capita Food Supply Trends: More Calories, Refined Carbohydrates, and Fats. FoodReview 2002;25(3):2-15.
 Freudenberg N. Free trade, the food industry and obesity: How changes in US – Mexico food trade contribute to an epidemic. Corporations and Health Watch, 2007.
 Gasparro A. Restaurants see brighter side of low calorie meals. Wall Street Journal, April 2, 2011.
1. ILRI via flickr
2. Ian Muttoo via flickr
3. Economic Research Service, USDA , Reference 6