UN says soaring price of basic foods such as rice and cereals could affect around 100 million of world's poorest people
Global rice stocks have halved since hitting a record high in 2001 while demand is continuing to rise
In Asia rice prices have almost tripled this year alone
Financial speculators, rising populations, floods, droughts, increased demand from developing countries, and removing crops from the food chain to produce biofuels have been cited as factors
Price rises have led producing nations to enforce export restrictions, further putting the squeeze on supply, especially in countries relying on imports
Chavez made the announcement ahead of his expected appearance at a summit of European and Latin American leaders in Peru that begins on Friday, where he says he will present his aid plan.
But the summit promises to be explosive for other reasons after Chavez on Thursday angrily denounced as "ridiculous" claims that Venezuela and Ecuador had aided the Colombia Farc rebel group.
The global police agency Interpol said in a report on Thursday that documents on laptop computers alleging those links and found following a Colombian attack on a Farc rebel base in Ecuador in March, were not tampered with.
Chavez said his country was revising its diplomatic, economic and political relations with Colombia following the report's release.
Leaders from four Latin American countries have already set up a $100m food security fund for staples such as rice, beans and corn in a bid to offset rising food prices that have sparked global protests.
The presidents of Bolivia, Nicaragua and Venezuela as well as Cuba's vice-president also promised joint agricultural programmes.
Rising food prices have led to violent, often deadly protests in more than 30 countries, including Haiti, Egypt and Bangladesh.
Oil prices have also continued to soar to more than $120 a barrel.
Climate change, increased food demand in Asia and the growing use of crops for biofuels have all been blamed for the price rises.