World Bank says rising food prices a concern, ready to help

By Doug Palmer

WASHINGTON (Reuters) - The World Bank on Monday said it stood ready to help governments respond to a broad-based run-up in grain prices that has again put the world's poorest people at risk and could have lingering detrimental impacts for years.

"We cannot allow short-term food-price spikes to have damaging long-term consequences for the world's most poor and vulnerable," World Bank Group President Jim Yong Kim said in statement.

"The World Bank and our partners are monitoring this situation closely so we can help governments put policies in place to help people better cope," said Kim, a public health expert facing his biggest challenge in two months on the job.

A severe drought in the U.S. Midwest has cut projected grain yields dramatically, reviving memories of 2008 when a sharp increase in food prices caused riots in some countries and raised questions about the use of crops to make biofuels.

Wheat prices have jumped more than 50 percent and corn prices more than 45 percent since mid-June, with dry conditions in Russia, Ukraine and Kazakhstan, excessively wet weather in Europe and a below average start to the Indian monsoon season adding to global crop worries.

Prices for soybeans, a critical food and animal feed crop, also have risen almost 30 percent over the past two months and nearly 60 percent since the end of last year.

"When food prices rise, 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 well being of millions of young people," Kim said.

Kim said the bank has a number of programs to help governments should the situation worsen.