This paper will analyze changes in state agricultural development and subsidy policy in Tunisia from 1980 – 2010, as those policies interact with world commodity price movements. In this way it will analyze and historicize the successive and overlapping determinations, over various time spans, which explain the politics of capital flows and commodity imports and exports during the most recent commodity price run-up, from 2005 – 2010. Common analyses of these crises tend to link price-hikes to countries’ over-dependence on food and fuel imports. In that way, they interpret that dependence as a phenomenon outside of government control. I will challenge this form of analysis by examining the role of the state in determining domestic prices and the direction of capital flows, and deciding what is or is not produced through its agricultural policies. This will involve examining state food politics through three stages: first, the stage of extraction from agriculture alongside subsidized urban consumption – the early 1970s through the mid-1980s. A second stage was the adjustment phase from the mid-1980s to the late 1990s, as low food prices subtended a transformation in state development policies, as the government reduced consumption end subsidies and redirected support to the largest farmers. A third phase ran from the early 2000s to the present. The state recommitted to consumer-end subsidies, in order to buffer the effects of world price shocks. Simultaneously, the state underinvested in the non-irrigated smallholder sector, thereby further locking in import dependency and encouraging underemployment. This paper will rely on several data sets: one, production prices broken down according to farm size, and so taking account of input costs. Two, data on other forms of governmental support for farmers, particularly loans and credits. Three, time series data on sales prices for the major commodities, so as to evaluate the price scissors effect. And four, information from the Cereals Office and the National Oil Office concerning price formation in order to understand the politics of prices. In summary, this paper analyzes world commodity price movements into the field of historical sociology through a closer examination of state agency, by examining how price inflation affects state capacity by forcing the state to commit budgetary resources to price protection, and thereby diverting it from committing resources to other developmental paths, while also examining the social origins of state agricultural policies, locating them in various networks with ties to state power.