USAID Statement on World Food Day

The U.S. Agency for International Development (USAID) today joins with its partners in the international community to commemorate World Food Day. World Food Day was designated by the United Nations in 1979 to raise awareness about hunger worldwide.

This year, international food prices of all major food commodities have increased significantly. In response to the current development challenge, the U.S. government will commit over $5.5 billion in fiscal years 2008 and 2009 to fight world hunger, including $1.8 billion of new resources in three areas: immediate and expanded humanitarian response; increasing productivity and addressing infrastructure constraints; and support for trade liberalization and increased use of advanced agricultural technologies.

This dramatic change in the global food landscape - the major increase in food prices - is being driven by several key demographic, economic, and agricultural factors:

• Shrinking of global grain stocks as a result of consumer demand growth (2%) outstripping productivity growth (1%) over the past several years.
• Increases in planting, harvesting, transport, processing and retail costs, as well as those of critical inputs, including seeds and fertilizers, driven by high oil prices.
• A relatively small contribution from increased biofuels production.
• Rising global demand for food products, driven largely by the welcome acceleration of economic growth in the economies of fast-developing countries and associated demand for food products.
• Export restrictions that reduced the supply of key agricultural commodities available on world markets.
• Recent production losses caused by droughts in some food exporting countries.
• Low investment in agriculture in developing countries over the past two decades, particularly in research and development.

Prices are likely to remain higher than in the past for the next five to seven years. These price increases can have major impacts on households in developing countries, which spend up to 70% of their income on food. The funds committed by the U.S. government will build on past or continuing investments in agriculture, including investments made through the President's Initiative to End Hunger in Africa and the Millennium Challenge Account.

The American people, through the U.S. Agency for International Development, have provided economic and humanitarian assistance worldwide for nearly 50 years.

SOURCE U.S. Agency for International Development