It has been noticed that the prices of the food items play an important role in the security of food, both at the household level and country level. It is unfortunate to know that most of the poor people in the world spend half of their income on food. The sudden hike in the prices of cereal and other similar items in 2012 have decreased the quality as well as quantity of food products. Studies have shown that this trend is increasing the insecurity and malnutrition among poor people. Mortality and diseases are increased because of undernourishment. Productivity of a person has also decreased due to undernourishment. Children are observed to be more affected by this problem.
Higher food prices in 2012 have an extremely negative impact on food security. The higher prices of food items are an important signal for those people all around the world, who are undernourished. Most of these people include livestock producers, farmers and fishermen. Higher prices are both a threat and an opportunity for such people. They can produce more food which will increase their income. However, higher food prices are also a major threat to them as the majority of the farmers are net food buyers. This means that they spend a major portion of their income on food.
It is also difficult for farmers to increase productivity as increasing productivity of the crop output needs a lot of investment. Getting the food products to the market is also a costly procedure. The hike in prices has a mixed effect on the food security at the country level. According to the World Bank report, more than forty four million people have been pushed into poverty due to the increase in food price, during the last two years. On the other hand, for about twenty four million producers, it has served as an opportunity to get out of poverty. Nevertheless, their number has been swamped by the sixty eight million people that have fallen below the poverty line.