World Bank President, Jim Yong Kim has expressed concern over food price volatility globally and the impact it might have on the poor as a result of the drought like situation in countries like the United States and India.
The impact of the US drought on global markets is exacerbated by other countries also currently suffering from weather-related production issues.
Almost continuous rain is causing problems for the wheat crop in many European countries, whereas the wheat crops in Russia, Ukraine and Kazakhstan have been hit hard by a lack of rain.
"In India, monsoon rainfall is about 20 per cent below the long-term annual average. July is the critical planting month and there may be major negative implications if rains do not pick up," Kim said.
"When food prices rise sharply, families cope by pulling their kids out of school and eating cheaper, less nutritious food, which can have catastrophic life-long effects on the social, physical, and mental wellbeing of millions of young people, the World Bank Group President said.
In 2012, prices have risen across all the non-rice grains - wheat, corn and soybeans: wheat prices are up over 50 per cent since mid-June; price for corn has risen more than 45 per cent since mid-June; and soybeans are up almost 30 per cent since the beginning of June and up almost 60 per cent since the end of last year.
The World Bank, he said, is monitoring this situation closely so that they can help governments put policies in place to help people better cope.
"In the short-term, measures such as school feeding programs, conditional cash transfers, and food-for-work programs can help to ease pressure on the poor," Kim said.
"In the medium- to long-term, the world needs strong and stable policies and sustained investments in agriculture in poor countries."
"We cannot allow short-term food-price spikes to have damaging long-term consequences for the world's most poor and vulnerable," he added.
Though thus far, crop projections do not indicate the potential for actual shortages in the major grains; stocks are low, and the harvests will continue to be dependent upon global weather, which leaves prices more vulnerable to higher volatility, he said.
Food price volatility creates unpredictability in the market and poses fundamental food security risks for consumers and governments, he said adding that volatility also discourages needed investment in agriculture for development due to increased financial risks and uncertainty for producers and traders.
While the prices of many food staples have risen sharply, the Bank noted that the current conditions differ from the 2008 crisis.
In 2008, while other grains increased in price, rice and wheat prices rose the most, although the price fell quite substantially in 2009 due to a notable supply response by farmers seeking to benefit from higher price.