Close-up of a wheat field
Close-up of a wheat field - 
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JEREMY HOBSON: To food prices now. The cost of basic agricultural commodities have been on a tear. Since last summer, contracts for future deliveries of wheat and corn have almost doubled. And yesterday, there was a 4 percent jump in the prices of corn and soybeans.

Marketplace's John Dimsdale joins us now live from Washington to explain what's going on. Good morning, John.

JOHN DIMDSALE: Good morning.

HOBSON: Why are these prices going up?

DIMDSALE: Yesterday's jump was due to a new report by the Agriculture Department here that predicted smaller harvests of many farm commodities around the world. This overall trend is due to two things, weather extremes -- we've had dry weather in Russia and South America, floods in Australia, rains in India are causing a real crisis for onion production there. Plus there is rising demand. Improving economies in developing nations is making supplies tight. China, for example is buying a third of the U.S. soybean production. Jan Randolph has been watching this as director of Global Risk Assessment with IHS Global Insight in London.

JAN RANDOLPH: Millions and millions of people being lifted out of poverty particularly in Asia and China, but also countries like Brazil. And they have improving diet. Particularly when they have a high meat content. That puts great pressure on feed stock.

HOBSON: So pressure from all sides, John. What can be done about this?

DIMDSALE: One way is to tamp down on speculation on rising prices. Investors trying to take advantage of these prices. So the Commodity Futures Trading Commission is meeting this morning to talk about changing some of the investment rules to try to keep speculation from puffing up prices even more.

HOBSON: Marketplace's John Dimsdale in Washington, thanks.