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Climate change poses both challenges and opportunities for sustainable agricultural growth, particularly in the developing world. As was witnessed during the 2010 droughts in Russia and floods in Pakistan, major climatic events can have significant negative impacts on agricultural markets, forcing global food prices higher and threatening the world’s food security.

As climate change continues to present new constraints to traditional agriculture, appropriate responses will require complementary policies at the farm-, country-, and global levels.

Agricultural trade plays an important role in the establishment of a fair, well-functioning global economy. At the same time, agricultural trade can also have a detrimental effect on global price stability and food security if policies are enacted that protect one region at the expense of another. Protectionist policies such as export bans or restrictions can actually increase global price volatility and lead to further food insecurity, particularly for developing nations.

2011 has seen continuing fluctuations in the international price of agricultural commodities such as wheat, maize, soybeans, and corn. These staples often make up the bulk of the diet of the world’s poor; thus, any drastic change in the price of these commodities can have serious impacts on the economic stability and food security of the developing world. The fear and uncertainty surrounding changing commodities prices panic policy responses that only exacerbate food insecurity.

Increasing food prices present both challenges and opportunities for the developing world. Just as the transmission of global prices to domestic prices can differ by country and commodity, the effects of changes in food prices within a country can differ from household to household. The welfare of urban and rural households may be affected differently, as will the welfare of net consumers compared to that of net producers.

Sustainable agricultural growth and fair, stable global markets are key to maintaining global food security and reducing hunger and poverty, as well as to fulfilling the G20 commitment to worldwide economic growth and development. How to encourage growth and maintain stable markets, however, is a complex and widely debated issue. Reliable, objective research is needed to address the concerns of both the developed and the developing world and to ensure that domestic needs are not protected at the cost of global stability.