## IMF Survey: Food and Biofuels: The Price of Success

_IMF News, December 3, 2007_

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**Canonical URL:** [IMF Survey: Food and Biofuels: The Price of Success](https://www.imf.org/en/news/articles/2015/09/28/04/53/sores123a)

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## Bibliographic details
- Authors: Simon Johnson IMF Research Department December
- Published: December 3, 2007

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### Overview
- Author: Simon Johnson, IMF Research Department.
- Publication date: December 3, 2007.
- Core argument: The adoption of biofuels is driving up world food prices, with the rise hurting the poor in low-income countries the most.
- Contextual note from the source: "Over the past 12 months, the world has experienced a substantial inflationary shock in the form of higher food prices."

### Key findings and observations
- "The adoption of biofuels is driving up world food prices."
- The rise in food prices is "hurting the poor in low-income countries the most."
- "Over the past two years corn prices have roughly doubled worldwide, although they have fallen slightly in recent months."
- The food-price shock "doesn't necessarily translate into higher sustained inflation; monetary policy in most countries appears to be responding appropriately."
- Specific examples cited: Australian wheat, Chinese pork, U.S. corn — used to illustrate global interconnectedness of food-price movements.

### Policy recommendations and implications
- Recommendation directed at rich countries: "removing ethanol subsidies and cutting high tariffs" to help limit the rise in food prices.
- Implicit policy implication: Actions in rich countries (subsidies and trade barriers) can materially affect global food prices and welfare in low-income countries.

### Impact and affected groups
- Primary adverse effects are on "relatively poor urban residents in low-income countries."
- The market shock is described as an inflationary shock in food prices over the past 12 months, with distributional consequences across countries.

### Noted uncertainties and nuance
- Food-price increases are framed as a shock that "doesn't necessarily translate into higher sustained inflation."
- Corn prices have shown recent volatility: "roughly doubled" over two years but "have fallen slightly in recent months."

*IMF Survey: Food and Biofuels: The Price of Success — Simon Johnson, IMF Research, December 3, 2007.*

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## References

- [https://www.imf.org/en/News/country-focus](https://www.imf.org/en/News/country-focus)
- [PRESS CENTER](http://presscenter.imf.org/)
- [IMF Research](https://www.imf.org/en/news/search)
- [Finance & Development](https://www.imf.org/external/pubs/ft/fandd/2007/12/index.htm)
- [Video: Johnson on food prices](https://www.imf.org/external/mmedia/view.asp?eventID=974)
- [Article: Biofuel demand and food](http://www.imf.org/external/pubs/ft/survey/so/2007/RES1017A.htm)
- [Climate change and the global economy](https://www.imf.org/external/pubs/ft/survey/so/2007/RES1026A.htm)
- [IMF press release on climate change](https://www.imf.org/external/np/sec/pr/2007/pr0747.htm)
- [F&D archive](https://www.imf.org/external/pubs/ft/fandd/fda.htm)
- [here](https://www.imf.org/external/pubs/ft/fandd/2007/12/straight.htm)
- [https://www.imf.org/en/home](https://www.imf.org/en/home)

_Source: https://www.imf.org/en/news/articles/2015/09/28/04/53/sores123a_