Last Week, the UN Food and Agriculture Organization said food prices have reached their highest level since it began measuring them in 1990, and pointed to the political problems that can spark.
Not only is there a risk, but there have already been riots in some parts of the world because of rising prices, FOA chief Jacques Diouf said.
There is little relief in sight, say experts.
I think commodity prices are going to be trending higher, said Gerard Lyons, chief economist for Standard Chartered Bank.
What's interesting is that even commodities that aren't heavily traded are rising in price. ... That suggests this is fundamental, not speculators, he told AFP.
The 2008 commodity spike was only a handful of food grains plus oil, and driven in large part by political decisions amounting to hoarding and heavy trader speculation.
This year the problem is more fundamental: prices are being driven by growing demand from huge emerging economies like China, India, Russia and Brazil that is unlikely to slacken until prices get much higher, say analysts.
The World Bank's Delgado said that supply shocks are exacerbating the price hikes: weather and policy moves that have cut grain supplies from Russia, Argentina and Australia, among others.
But the trend is rooted in the fundamentals of soaring demand, say economists.More and more people are moving up the scale of income, so they tend to have higher value food, said Nariman Behravesh, chief economist at IHS Global Insight.
Lyons said there is not much relief on the horizon because of the time it takes farmers to expand acreage and production.It takes a long time, two to three years, for new supply to come on stream, Lyons said. I think commodity prices are going to be trending higher.
Commodity traders are saying the same thing.
Last week Morgan Stanley commodities specialist Hussein Allidina said key items like corn, soybeans and wheat still face strong upward price pressure - with corn possibly going up another 20 percent from the current level of $6.60 a bushel before demand weakens.
We see record tightness across the agriculture complex and believe that higher prices will be necessary to ration demand and incentivize acreage, he said in a report.
Behravesh said he thinks the problem is mainly a short-term one, more like 2008, and have limited economic impact overall.
But policy-wise, he said governments don't have many tools to bring down the cost of food and other commodities, especially if they are import-dependent.
Aside from pushing up interest rates to slow growth, said Behravesh, There's not much central bankers can do about food prices.
The United Nations Food and Agricultural Organisation said record food prices in December were 25 per cent higher than a year earlier.
The warning follows a key world Food Price Index reaching a record 215 points in December, up 4 per cent from November and one point above its previous record during the food crisis in 2008.
Meat and Livestock Australia chief economist Tim McRae said demand was growing steadily for lamb, beef, pork and chicken as the world economy recovered after the Global Financial Crisis.
Here are the must own stocks as Food Prices keep rising
Olam International, Noble Group, Wilmar International
Singapore listed commodities companies are set to become the rising stars of the exchange in 2011 and will become global players of significant importance.
Olam International Ltd, Wilmar International Ltd and Noble Group Ltd are most likely to lead the charge as the benefit from home grown markets in ASEAN, China and India, where the world's largest populations are consuming more and more of the world's food supply.
Cash Flow is on the rise at Noble and Olam, both have successfully made the switch into production from trading, have been expanding ever since.
Olam is the world's largest supplier of cashews and sesame seeds, and is among the biggest sources of cocoa, rice, peanuts and cotton. It operates in 64 countries.
Noble is Asia's biggest supplier of raw materials. Only 22 percent of its revenue comes from agriculture, with the remainder coming from materials such as iron ore.
It has invested heavily in mines and processing.
Wilmar is Asia's leading agribusiness group and the world's largest integrated palm oil company.
Golden Agri-Resources Ltd is the world's second largest palm oil plantation with a total planted area of 435,000 hectares (including small holders) as at 30 September 2010, located in Indonesia. It has integrated operations focused on the production of palm-based edible oil and fat products.
Demand is expected to grow because of demand for biofuels, which is part of the reason the company bought the sugar and renewable energy businesses from Australia's CSR.