Agricultural Development Economics


A simple price monitoring tool to assess monthly changes in food prices
David Dawe, Ali Doroudian
Publication date
This paper presents a simple tool that can be used to monitor developments in market prices. The data requirements are relatively simple: all that is needed are monthly data on nominal market prices and the consumer price index (CPI). At least seven years of data are highly desirable, although it is possible to work with less depending on market dynamics. Given appropriate data, the price monitoring tool can be used for any level of the marketing system (farm, wholesale, retail). It can also be used for any type of food commodity, although staple foods such as rice, wheat and maize are the most likely candidates because of their importance to large numbers of farmers and consumers. The price monitoring tool can be implemented and automated in any basic spreadsheet. The final output is a graph that shows past trends in prices as well as “benchmarks” for future price developments.