WTO’s Lamy Blames Export Restrictions for Food-Price Increases

26/01/2011 12:00 - 396 Views

World Trade Organization Director- General Pascal Lamy criticized export restrictions imposed by countries as a primary cause of food-price increases and called for humanitarian food aid to be exempt from tariffs.

Lamy attributed increases in cereal prices this year and last to export restrictions in Russia and Ukraine imposed after the nations suffered droughts. Grain-exporting countries must increase food production, bolster safety nets and raise levels of food aid and food reserves, he said.

“Export restrictions lead to panic in markets when different actors see prices rising at stellar speed,” Lamy said in a speech today at a meeting of agriculture ministers in Berlin, according to an e-mailed transcript.

Grain prices soared globally last year after adverse weather cut output from Russia. The Standard & Poor’s GSCI Agriculture Index of eight futures climbed 43 percent in the last 12 months, led by cotton, corn and wheat. Flooding in Canada, China and Australia also contributed to the increase.

To contact the reporter on this story: Patrick Donahue in Berlin at at pdonahue1@bloomberg.net.

To contact the editor responsible for this story: James Hertling at jhertling@bloomberg.net

Jan 22, 2011 5:00 PM GMT+0700
By Patrick Donahue
Source: Bloomberg.com