Patrick Westhoff’s book “The Economics of Food: How Feeding and Fueling the Planet Affects Food Prices” is a fascinating read because it is targeted to non-specialists who desire to understand the recent trend of high food prices in the world.

Westhoff uses the food crisis in 2008 as a focal point to explain what factors and how they each affect food prices. He also emphasizes that food prices can be affected by a myriad of factors simultaneously, and it is often difficult–sometimes impossible– to disentangle these various factors to determine the degree they cause low or high food prices.

Westhoff gives eight rules of thumb on food prices. The first rule of thumb is increasing biofuel production raises food prices. When food crops such as corn are planted for biofuel, this reduces the available food, which in turn causes food prices to increase. Unless corn production can be raised to replace those diverted for biofuel, demand in biofuel would certainly raise food prices because less food is produced. In the US and Europe, government policies demand that a certain proportion of petrol to consist of biofuel. And to boost biofuel production, government subsidies are given to farmers to encourage more planting for biofuel. In the height of the food crisis in 2008, US government subsidies are one of the reasons blamed for the increase in food prices.