Food Price Inflation Set to Skyrocket MoneyNews.com A huge and rapid rise in food prices is prompting poor food-producing countries to shut off exports — a decision which could make matters worse. Indonesia, which imported 1.4 million metric tons of rice in 2007 and expected a bumper crop this year, has joined Vietnam, Egypt, India and China in banning rice exports. Other countries are holding back wheat. The United Nations’ reports that global food prices surged 57 percent last month from a year earlier. The World Bank estimates food prices have risen globally by 83 percent over the past three years. So far, the U.S. has been isolated — grocery prices here rose by just 5 percent last year. Worldwide, cereal stockpiles are expected to fall to a 25-year-low of 405 million tons this year, down 5 percent from last year’s already low level. Rice hit the $1,000-a-ton level for the first time ever this week the export restrictions, reports The Financial Times. "Food prices, if they go on like they are doing today ... the consequences will be terrible," International Monetary Fund managing director Dominique Strauss-Kahn said during a recent conference on the problem. "Hundreds of thousands of people will be starving,” he warned, adding that development gains made of the past five or 10 years could be "totally destroyed." Strauss-Kahn’s fears are supported by figures from the World Bank that show food prices are largely responsible for forcing 100 million additional people into extreme poverty, setting the stage for famine and social unrest. [Editor’s Note: Special: Max Shows You How to Profit From $100 Oil] Social unrest driven by food costs has already occurred in 33 countries, and 37 more countries may face social upheavals if food prices continue to rise, according to the World Bank. Though many point to biofuel production as a major reason for food shortages, it’s the low national grain stockpiles and soaring costs of rice and wheat — neither of which are used in biofuels — that are the most troubling. Global demand for both grains has soared at the same time that flooding and droughts severely reduced harvests. As a result, the poorest countries may spend 56 percent more on grains this year than a year ago. The cost of rice, basic to most diets in Asia, has risen by 75 percent in two months. The cost of wheat, a staple in most Western diets has gone up 120 percent in the past 12 months. Kazakhstan just joined the list of countries struggling with food inflation by banning exports of wheat. U.S. wheat stores are at a 62-year low. Responding to an appeal made to the international community by World Bank President Robert Zoellick, the U.S. has agreed to release $200 million in emergency aid to help countries where the soaring cost of basic food has spurred riots and instability. "The international community must fill at least a $500 million food gap identified by the U.N.'s World Food Program to meet emergency needs," Zoellick told CNN. "While many are worrying about filling their gas tanks, many others around the world are struggling to fill their stomachs, and it is getting more and more difficult every day."