The sudden onset of a serious drought across much of the US has caused a major spike in food commodity prices according to research conducted by the QNB Group which suggests that the price increases could threaten the food security of a number of countries.

The US currently grows around 40% of the global corn crop, meaning that the poor harvest there affects food stability around the world.

Concerns about the drought in the US have pushed the prices of three key foods; corn, wheat and soy to record prices, with the cost of a bushel of each reaching $ 8.28, $ 9.44 and $ 17.77 respectively. Most prices have eased in recent weeks, although they do remain elevated, according to the research.

At the end of July, future contracts for the delivery of wheat and corn were nearly 50% above the rates for June, while Soy remained 25% higher.

According to QNB Group, the high prices are exacerbated in many countries by the strength of the US dollar, which is about 15% stronger against six major international currencies now than in July 2008.

Although there have been forecasts of substantial rainfall, these are unlikely to affect the prices as the corn and wheat crops have already passed their pollination stage.

Important exporters, Russia and Ukraine have also experienced dry years, and floods in parts of Asia have threatened the rice harvest.

According to analysts, prices are expected to reach new highs in August and September, but will then ease off as other countries begin to harvest and export their crops. High global cereal stocks of around 515mn tonnes mean that the hike may not have such a negative impact.

The price increases have yet to affect others types of foods, with the global food price index produced by the UN Food and Agricultural Organisation at its lowest in nine months in June.

However, the price rises should affect the index in the future, and high crops prices will increase the prices of meat and dairy because of the higher costs of animal feed.

QNB Group argues: “The experience of recent years suggests that high and volatile food prices may be the new normal. This is a result of a range of factors including growing demand from an increasingly affluent global middle class, as well as the substitution of some crops from food to biofuels.”

“On the supply side, the instances of both droughts and floods appear to be increasing as a result of climate change. Speculation in the futures markets may also be a factor, although its significance is debated,” they said.

According to the group: “The world needs to find new mechanisms to adapt to the changing food situation, increasing production, developing strategic reserves and providing assistance to the poorest and most food insecure countries.”