UN moves to boost farm output as food prices climb

By Phil Stewart

ROME (Reuters) - The United Nations' world food body outlined steps on Monday meant to help the world's poorest nations combat soaring food prices, including a new voucher program for farmers and a review of food-guzzling biofuels.

The Rome-based U.N. Food and Agriculture Organization's food price index jumped almost 40 percent this year from 2006 and hit its highest level since being launched in 1990.

Hardest hit are those poor nations most dependent on food imports. FAO chief Jacques Diouf pointed to political unrest over food markets in countries like Yemen and Senegal.

"There is a very serious risk that there will be less people able to get access to food because of prices," Diouf said.

Speaking to reporters in Rome, Diouf said the FAO was ready to allocate an initial $17 million of its own funds to a voucher program so that poor farmers could pay for materials like seeds and fertilizer needed to boost farm output.

"Naturally we expect that there will be bilateral and multilateral support (additionally)," he said.

More investment in rural infrastructure could also boost food supplies, as would easier-to-access financing for food imports in poor countries, he said.

Diouf also raised the issue of biofuels, saying they would be examined at a high-level conference on food security in June.

"Policies on biofuel need to be coordinated at an international level taking into consideration the objective of fighting hunger," he said.

The global cost of imported foodstuffs this year was expected to be 21 percent higher than in 2006, and the highest amount on record.

Diouf cited more than 20 countries including Argentina and Azerbaijan, Mexico and Morocco, where governments were trying to offset international price increases for food -- often by restricting exports or cutting tariffs on food imports.

The price increase is being driven by factors including droughts and floods linked to climate change, and high oil prices that are boosting demand for biofuels. He also cited changing diet in emerging market nations like China as a factor.

Chinese consumers ate an average of 20 kilograms (44 lb) of meat a year in 1985, but this shot up to 50 kg in 2007. This reduces the amount of grain available because one kg of beef can take as much as eight kg of grain to produce, he said.

Population growth makes the problems stemming from the price rises even worse, he said.

(Editing by Tim Pearce)