Article: Global Food Crisis: Causes and Implications for India

Global cereal production is only sufficient to meet current consumption. According to the Food and Agricultural Organization (FAO), food grain prices will continue to rise for the next 10 years. This is due to constraint in cereal supplies - attributed to foodgrains being used for biofuel - as well as rising demand, which is attributed to population growth.
Another trend that has been witnessed worldwide is the rising demand for meat and milk products - leading to rise in the price of grain. With increasing consumption of livestock products, more grain is being diverted as feed.
Although the reasons for rising prices vary from cereal to cereal (and region to region), there are certain broad trends:
 ~ Climate change has affected supplies.
 ~ Fall in soil fertility – again, due to climate change.
 ~ Rise in fertilizers prices due to the increasing cost of oil.
 ~ Foodgrains have been diverted for use as biofuels.
 ~ Changing dietary preferences (more meat, milk and eggs) as people have more money to spend.
 ~ Rising cost of (genetically modified) seeds.
The author says that this is nothing new - as in 1973 also rise in oil prices had lead to a doubling of grain prices. What is new, however, is that more and more land is being diverted to produce biofuels. This has further affected the price of foodgrains. Filling up a large vehicle with ethanol (only once) means using up enough maize to feed a man for an entire year!
Drought-like conditions prevailing in major cereal producing nations (Australia and Canada) have also affected the production of cereals. This may be attributed to the influence of climatic change. The increasing scarcity of water - and arable land - has lead to greater uncertainty in the supply of foodgrains.
The crux of the problem (according to M.S. Swaminathan) is that agriculture is largely energy-intensive; and with the rise in crude oil prices, the cost of agricultural inputs like fertilizer and pesticides has also increased… In the short term, the food and fertilizer subsidy bill has increased – but, obviously, this is not sustainable over a longer period.