Colorado Corn

Fuel prices are closely linked to food prices through three different channels, according to Christopher Barrett, professor of applied economics and management and international agriculture at Cornell University’s Dyson School.

Barrett explained, “Higher fuel prices are a major driver behind increased food prices, hunger and poverty around the world today.”

“First, fuel is an important input into agricultural production in modern commercial agriculture, through fuel for machinery and fertilizers,” he said.

Second, fuel is a major cost of moving food from surplus areas to deficit areas through trade. This doesn't matter much to food exporting areas, like most of the U.S., but it matters a lot to food importing countries, such as landlocked countries in Africa or central Asia, which are far from surplus production zones, he added.

Barrett stated as fuel prices go up, more agricultural output gets diverted into biofuel production and more cropland gets converted to biofuel crops, reducing the supply of food, “thereby further driving up prices.”