Supply shortages spurring record food prices around the globe Farmers around the world are failing to keep up with burgeoning demand for their crops as the smallest corn inventories in nearly 37 years are driving prices to near record levels.

The U.S. Department of Agriculture said that growers from nations as varied as Canada and Russia have increased output of food staples like wheat, rice and grain by 16 percent since 2000 - that output still trails the 20 percent uptick in demand for food over the past decade. In the U.S., analysts have forecast a 3.5 percent growth in corn planting, but the government says world stockpiles will equal about 15 percent of use, marking the lowest ratio since 1974.

The USDA projects global inventories to decline 13 percent before the next harvest; if that occurs, it will be the first time since 2007 there has been a drop. The rising demand has been a boon for farmers in the U.S., but it has fueled rising consumer prices in other countries and spurred isolated food shortages in countries. In fact, rising food prices contributed to the recent overthrow of the government in Tunisia, analysts affirm.

Paul Jesche, a farmer in Illinois, said he plans to increase corn planting by 50 percent as it is nearly $200 more profitable per acre than soybeans at current prices. "We need to grow a huge crop this year to meet global food needs," he said. "The increased demand for meat and dairy is driving demand for corn and soybeans."

Corn prices have surged 95 percent over the past 12 months to $7.2025 per bushel.  
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