For some time, many parts of the world food prices have risen considerably. In Hungary, the food prices have 13% higher than a year ago; in China, food prices rose 6% compare with last year; while Germany, Italy and the UK the food prices have also been risen; in the United States, food prices index in February rose 4.6% than last month, food prices rose 3.1% than previous year.

Worldwide food prices rise so dramatically, what is the reason? Whether this rising trend will continue? What impact will have on the economy?

U.S. food expert said that the food prices rise caused by the production of biological fuel ethanol. Production of bio-fuels takes too much of the land. In the United States, an acre of land planted corn produce fuel is equivalent to 50 gallons of gasoline. While Americans burn 134 billion gallons per year of gasoline; Europeans are close to this number. U.S. needs 800 million acres of land to grow corn can meet ethanol to replace 10% of gasoline requirements.

Another expert, the U.S. Department of Agriculture Economic Research Service agricultural economist Annette pointed out that corn are used extensively for feeding livestock, food prices rise will lead to other food prices rising, whether it is beef or chicken, of course, cattle, they all eat the best feed, the price will surely rise, like milk and cheese products.

Annette believes that unless the United States and Europe to stop using bio-fuel ethanol to replace gasoline, or food prices will continue to rise. Nevertheless, some economists believe that the price of food has always been volatile; the range of rising and falling is relatively large. If like Brazil with large land can dramatically increase corn cultivation, food prices may fall.

As the food prices rising will lead to generally inflation, the U.S. Department of Agriculture’s Agricultural economist Annette pointed out that inflation often not a kind of commodity prices rise cause, but also triggered by different situations arise.

However, some developing countries are facing food prices lead to inflation risk. In the Philippines, food products in the consumer price index accounted for 50%; in Thailand, this proportion was 35%. In China, Shanghai, people said the price of green vegetables has doubled a year ago, meat and vegetable oil prices also have risen.

International analysts have estimated that China’s corn reserves now are about 30 million tons, while in the late 90s of last century; China’s maize reserves up to 100 million tons, this means that China’s reserves are only enough 2 or 3 months supply. However, China is still corn-exporting countries, but after a few years it will be a corn importer. Therefore, some economists pointed out that China must take bold measures to prevent future food problems.