All around the world, poor weather has reduced harvests and driven up food prices, fueling inflation risks and hitting the most vulnerable. Floods in Australia, Pakistan, and parts of India have helped push up the cost of food, as have droughts in the US, China, Argentina, and Eastern Europe. Energy prices are again on the rise, with likely knock-on effects for food. Many countries, especially developing and emerging economies, are struggling with the implications of high food prices, given their effects on poverty, inflation, and,for importing countries, the balance of payments. Higher food prices may also have contributed to social unrest in the Middle East and North Africa.
An insightful article from the IMF website provides a good insight, click here to open the PDF
