The Group of 20 countries are planning a meeting to coordinate a response to surging food prices, the Financial Times reported as the worst U.S. drought in more than half a century devastates crops, lifting grain prices to record highs.
G20 officials plan to hold a conference call in the week of August 27 to discuss a meeting, which could be held in late September or early October, the Financial Times said, quoting four unnamed officials familiar with the conversations.
Benchmark Chicago corn climbed to an all-time high on Friday after the U.S. Department of Agriculture cut its production estimate by 17 percent, intensifying fears the world is headed for a repeat of the 2008 food price crisis, Reuters reports.
The G20 meeting would be the first of the Rapid Response Forum, a newly created body to promote early discussion among decision-level officials about abnormal international market conditions, the newspaper said.
The forum is part of the G20-backed Agricultural Market Information System, created last year at the initiative of France and seen as a key policy response to the 2007-08 crisis, it said.
The rally is grain prices has renewed the food-versus-fuel debate centred on the U.S. ethanol mandate as 40 percent of the corn crop will be made into fuel for cars and trucks.
Still, G20 officials emphasised the planned meeting was not a sign of panic.
“In many respects it is just making sure everyone is on the same page in terms of what the situation is, and certainly trying to discourage any policies that would exacerbate the volatility,” the paper quoted one G20 official as saying.