THE DAILY CHART: Beware the sugar high

Much attention has been devoted to the impact the Queensland floods will have on the state's coal sector, but rising food prices should serve as a reminder that the sunshine state has some other industries. Queensland's agricultural sector has been severely disrupted – the sugar sector alone is facing losses of $500 million. But rising food prices were on the cards well before the heavens opened up in Australia. The United Nations Food and Agriculture Organisation's composite food index recently passed the peaks reached during the food price shocks of 2008. Sugar was one of the chief culprits, touching 30-year highs in late December.

Higher food prices aren't nearly as frustrating for consumers in the developed world as they are for policymakers in the developing world. Tunisia is currently in the grips of a state of emergency where outbreaks of violence ostensibly due to frustration with higher unemployment has the potential to worsen if food becomes more expensive. Higher food prices mightn't seem like a big deal for the Australian consumer, but if inflation gets out of hand in the developed world courtesy of food prices central banks will be forced to step in, taking some of the heat out of other sectors in those economies that Australia relies on.