The rise in food prices is already causing distress among consumers in some parts of the world - especially relatively poor nations such as India and China. If the trend gathers momentum, it could contribute to slower global growth by forcing consumers to spend less on other items or spurring central banks to fight inflation by raising interest rates.
Politicians in markets where food costs are a particularly sensitive matter are moving to counter rising prices before they take a bigger economic toll or fuel unrest. But it remains unclear whether those policies will be enough to contain the current pressures, or whether a longer-term bout of food price inflation - similar in ways to the recent climb in prices for oil and other commodities - is in the offing.
One of the chief causes of food price inflation is new demand for ethanol and biodiesel, which can be made from corn, palm oil, sugar and other crops. That demand has driven up the price of those commodities, leading to higher costs for producers of everything from beef to eggs to soft drinks. In some cases, producers are passing the costs along to consumers. Several years of global economic growth - led by China and India - is also raising food consumption, further fanning the inflationary pressures.
Food price inflation has been climbing - in some cases sharply - in India, China, Europe, and in even smaller economies such as Turkey, South Africa and Poland. In Hungary, it is running at more than 13 percent a year, compared with less than 3 percent in 2005. In China, food prices are climbing at a 6 percent pace, more than three times the speed of a year ago. Prices are also up in Germany, Italy and the United Kingdom.
The U.S., too, is seeing some stirrings, with food costs rising 3.1 percent in February from the year before - a rate one percentage point higher than in mid-2005. Economists say U.S. food prices are expected to rise faster than the general rate of inflation this year. Wholesale prices of meat, poultry and eggs have already increased.
In Utah, farm income rose by 5 percent, to $1.3 billion for 2005, the latest available figure. Much of that increase was for livestock, at $1 billion, the state's largest agricultural sector, and crops, which generated $290,000, according to the Utah Department of Agriculture and Food. Part of the increase in income can be attributed to the end of a five-year drought, bringing increased crop yields and healthier livestock.
If the trend continues, U.S. consumers probably will see higher prices at the supermarket for everything from milk to cereal to soda pop, because corn is used to feed livestock and make high-fructose corn syrup, a key ingredient in many soft drinks. A spokesman for the National Chicken Council, a poultry-industry group, recently testified to a congressional subcommittee that Americans should expect higher chicken prices because of what the group described as ''the ethanol crisis.''
Doomsday predictions of a major food shortage in China and elsewhere have circulated for years but haven't materialized. And some economists believe the recent increase in crop demand probably can be met without severely straining the global economy. They think prices could come back down over time, especially if some countries that have more land that could be put under cultivation - particularly Brazil - can greatly increase production. Technological advances, such as better seed varieties, could also help boost production to keep up with demand.
Even so, higher farm prices aren't bad for everyone. They could help boost incomes for the rural poor in developing nations, who have been bypassed by gains in the manufacturing and service sectors. In some cases, the rising demand for food also reflects the growing wealth of once-destitute populations around the globe.
So far, higher prices haven't generated a huge rise in overall global inflation, which remains relatively low and stable by historical standards. Moreover, food prices are notoriously volatile, and some of the increases are because of short-term or local factors that could reverse in time.
But many economists believe the forces causing the current bout of food inflation will persist, or recur in years ahead. Many countries are facing shortages of land and water that didn't exist during past food price spikes, so they can't easily plant more to ease the strain.
Researchers at Swiss bank UBS AG note that average food prices in China have grown faster in the past five years than in the previous five, as more agricultural land is taken up for factories or high-rise condominiums. Changes in diets are also exacerbating the problem, as rising incomes allow the Chinese and consumers in many other places to eat more.
Some economists contend that China and India appear to be reaching a point at which nothing short of a bumper crop of key commodities will be enough to meet local needs and prevent further surges in food prices. In fact, China and India have achieved historically high production of some crops in recent years, only to see prices continue to climb.
Global grain stocks are at their lowest level in 30 years, after several years of strong global economic growth, and could become even tighter if farmers divert more crops to make ethanol or other fuels. By some estimates, about 30 percent of the U.S. grain harvest probably will be devoted to ethanol production by 2008, up from 16 percent in 2006.
All of this puts the world's central banks in a bind. Although they have confronted spurts in energy prices, many of them haven't had to cope with prolonged increases in food prices since the 1970s. Since then, food price inflation has remained relatively benign, even as incomes worldwide have climbed, allowing consumers to beef up their diets.
A more sustained bout of food price inflation, if it emerges, could force banks to keep interest rates higher than they would otherwise be. India, for one, has increased interest rates several times in the past year in part to combat food price inflation.
Today, the inflation risks may be greatest in developing economies. In the Philippines, food accounts for 50 percent of the basket of goods included in the consumer price index, an inflation benchmark. In Thailand, it's about 35 percent, according to data from Macquarie Bank Ltd. In the U.S., food makes up only about 15 percent of the CPI.
Some economists say China will have to take more aggressive steps to prevent future food problems. These changes could include allowing the proliferation of large - but more efficient - corporate farms similar to the ones that drove many small growers out of business in the U.S. in recent decades. Such a push would be extremely difficult for China because it needs to preserve jobs for the tens of millions of people who live in rural areas.
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* DAWN HOUSE contributed to this story.

