# Empirical View
# Food Prices
# Food Prices over the very long run
The visualisation shows the price of Wheat over more than 7 centuries.
Wheat prices in constant 1996 pounds, 1264-19961Full screen view Download as static image Download Data
Wages in the manufacturing sector vs. several food prices in the USA, 1901-2002 – BLS Data2
Index of real corn and wheat prices, 1866-2008 – Sumner (2009)3
The FAO Food Price Index (FPI) is a measure of the international prices of food (e.g., between suppliers or nations), while the food consumer price index (CPI) is a measure of the price of food to the actual consumer. The following graphs show that “the FPI translate to higher consumer prices only to a very limited degree and with a time lag of a few months.” The lag is often due to the time needed to harvest, transport and process food to the consumer. The limited relationship in the magnitude of the two indices “is explained by a combination of factors that determine vertical price transmission in every food economy, including mark-ups for transportation, processing and marketing, and by any subsidies at the consumer level.”4
Global food consumer price index (CPI) & FAO food price index (right-hand scale), 2001-2013 – FAO (2013)5
# Food Volatility
The volatility of food prices matters very much for the wellbeing of people, but the reason why is not as straightforward as with other topics discussed in this database. For this reason this entry has a slightly different structure than the others. First I’ll try to persuade you that a low volatility of food prices matters very much for people – especially poor people. And only then will I look at the long-term change of the food price volatility. The last two sections are (as usual) about correlates and consequences and about data availability and quality.
# Consequences of High Food Price Volatility
Volatility of real wages of laborers in Stockholm/Sweden, 1468–2004, measured as the percentage year-on-year change in real wages – Söderberg (2010)6
Real wages of unskilled laborers in Stockholm, 1365-1864, and industrial workers in Sweden, 1865–2004 (index 1950=100) – Söderberg (2010)7
Volatility of the deflator consumer price index (CPI), 1291-2004, measured as the percentage year-on-year change in the CPI – Söderberg (2010)8
Volatility in real wages and in the deflator consumer price index (CPI), 1291–2004, measured as the standard deviation of the percentage year-on-year change – Söderberg (2010)9
|Period||Volatility of real wages||Volatility of deflator CPI|
|1291 - 1399||38.1|
|1400 - 99||17.8|
|1500 - 99||20||19.2|
|1600 - 99||16.4||14.7|
|1700 - 99||13.3||12.6|
|1800 - 99||9.5||6.9|
|1900 - 2004||4.7||7|
Domestic food price volatility by level of economic development, 2000 and 2010 – FAO (2013)10
# Long Run Evidence of the Decrease of Volatility
Year-to-year variation in the price of wheat in pisa, 1351-1799 – Ó Gráda11
Coefficients of variation for wheat and rye combined – market integration in the North and Baltic Seas, 1500-1800 – Jacks (2000)12
# Correlates, Determinants & Consequences
# Determinants of Food Prices
Correlation coefficients between % yield and % price inverted, 1211-1491 – Campbell13
# Determinants of Food Price Volatility
# Evidence of the Increase of Food Trade and the Effect of Trade on Food Price Volatility
Average distance of world wheat production from London, 1866-1930 – Olmstead & Rhode (2007)14
Anglo-American wheat Trade, volume and price, 1800-2000 – O’Rourke & Williamson (2005)15
In the following graph you see two important aspects: Firstly the correlation between price correlation and distance and, secondly, how in India between 1750-1830 and 1870-1914 the agricultural market became more integreated, and the price differences between different regions were reduced.
# Market integration in Japan, Indonesia and India – average correlation coefficient vs. distance, 1750-1914 – Van Zanden (2009)16
# Kerala Study of the Effect of Mobile Phone Adoptions on Price Volatility – The Digital Provide
Mobile phone adoption by fishermen – Jensen (2007)17
Prices and mobile phone service in Kerala – Jensen (2007)18
# The Effect of Protectionism
Decomposition of ‘world’ price variance, 1830-1913 – Federico and Persson (2007)19
# Data Quality & Definition
# FAO Food Price Index
“The FAO Food Price Index is a measure of the monthly change in international prices of a basket of food commodities. It consists of the average of five commodity group price indices [cereal, vegetable, dairy, meat and sugar], weighted with the average export shares.”20
# Data Sources
# Historical Statistics on Food Prices
# Food Price Data by David Jacks
- Data: David Jacks an expert in agricultural history publishes many food price series on his website.
- Geographical coverage: Many countries and regions around the world
- Time span: Some of the series go back to the Middle Ages but most start after 1800.
- Available at: David Jacks personal website here and here.
# Food Price Data by Nicholas Poynder
- Data: Monthly grain prices
- Geographical coverage: Different places in England
- Time span: 1270-1955
- Available at: The website of the International Institute of Social History here.
# Data on Food Prices in Recent Decades
# FAO – Food and agricultural price statistics
- Data: Food prices of over 200 commodities for primary crops, live animals and livestock – “representing over 97 percent of the world’s value of gross agricultural production” (FAO). Producer prices and producer and consumer price indices.
- Geographical coverage: Over 130 countries.
- Time span: The up-to-now series go back to 1991, whilst the Price Archive contains historical data from 1966 to 1990 (these series are not always comparable). Monthly and annual data.
- Available at: The FAO Food and Agricultural Price Statistics are online here.
# FAO – Food Price Level Index
- Data: FAO Food Price Index
- Geographical coverage: Global
- Time span: Since 1961
- Available at: the FAO food price level index page.
# FAO – GIEWS Food Price Data and Analysis Tool
- Data: Database with over 1170 series of prices of different food commodities
- Geographical coverage: Over 80 countries – often several cities within the same country
- Time span: Some series going back to 1990
- Available at: the FAO here.
# Famine Early Warning System (FEWS)
- Data: FEWS publishes country-by-country Price Bulletins that provide graphs tracking the prices of commodities that are important locally.
- Geographical coverage: on a small scale level within countries.
- Time span: mostly the recent past.
- Available at: www.fews.net
- FEWS was created in 1985 by the US Agency for International Development (USAID).
# International Coffee Organization (ICO)
- Data: Data on coffee prices, coffee trade, coffee consumption and more is available from the International Coffee Organization (ICO).
- Geographical coverage: Global
- Time span: From 1990 onwards.
- Available at: www.ico.org