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Thursday, March 23, 2023

Global Food Prices hit 10-year High, UN says

According to the United Nations Food and Agriculture Organization (FAO), global food prices have risen by more than 30% in the previous year, reaching their highest level in almost a decade.

The findings from the agency showed the worldwide rise in the cost of grains and vegetable oils.

Following an almost 10% increase in October, vegetable oil prices reached a new high.

Supply disruptions, rising commodity costs, manufacturing closures, and political tensions are all contributing to price increases.

In comparison to a year before, the FAO’s gauge of cereal prices went up by more than 22%.

Wheat prices have risen over 40% in the last year as a result of bad harvests in key exporters such as Canada, Russia, and the United States.

“In the case of cereals, one might argue that climate change is eventually driving decreased output,” said Peter Batt, an agriculture expert from Curtin Business School, to the BBC.

“In a lot of regions, we’ve had fairly awful years [in terms of crops].”

The FAO claimed that increases in the cost of palm, soy, sunflower, and rapeseed oils pushed up its index of vegetable oil prices.

Prices for palm oil have risen as supply from Malaysia has been “subdued” owing to chronic migrant labour shortages, according to the FAO.

Labor shortages are also contributing to rising food production and transportation costs in other regions of the world.

Mr. Batt stated, “Another issue that has arisen is the distribution of the goods. For example, we’ve had a number of ships arrive in Australia to carry the food away, but because to Covid, we can’t get personnel to come in.”

Milk prices have risen about 16 percent in the last year as a result of shipping problems.

Speculation on global markets, according to Macquarie University’s Brigit Busicchia, is also adding to price volatility: “Since the 1990s, the liberalization of commodities futures trading has allowed institutional investors to enter this market on a massive scale.”

This has a particularly negative impact on countries that rely heavily on food imports.

“Expect conflicts in the providing of cereals in nations like Egypt or other Middle Eastern countries,” she added.

Ms Busicchia also pointed out that rising food costs are often felt most sharply by the poor, as disadvantaged groups are pushed farther into poverty, and that this can exacerbate social and political tensions.

Cedric Blackwater
Cedric Blackwater
Cedric is a journalist with over a decade of experience reporting on local US news, and touching on many global topics. He is currently the lead writer for Bulletin News.

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