Food Prices Jumped 20.7% A Year And Reached A Record High In February, According To The UN Agency.

Shoppers walk past a fruit stand at a street market in Mexico City, Mexico on December 17, 2021. REUTERS/Luis Cortes/File Photo

ROME, March 4 – (This March 4 article corrects the year-on-year percentage change in the headline and first paragraph to 20.7% from 24.1% after the official FAO correction)

Global food prices hit a record high in February, boosted by higher prices for vegetable oils and dairy products, up 20.7% year-on-year, the UN food agency said Friday.

The Food and Agriculture Organization (FAO) Food Price Index, which tracks the world’s most traded food commodities, averaged 140.7 points last month, up from a downwardly revised 135.4 points in January. This figure was previously listed as 135.7.

Higher food prices have contributed to a wider surge in inflation as economies recover from the coronavirus crisis, and FAO has warned that higher prices put poorer people in import-dependent countries at risk.

FAO economist Upali Galketi Aratchilage said concerns about the state of crops and the possibility of exports only partly explain the rise in global food prices.

“A much bigger push for food price inflation comes from food production outside the country, in particular from the energy, fertilizer and feed sectors,” he said. “All of these factors tend to drive down profit margins for food producers, discouraging them from investing and expanding production.”

The data for the February report was mostly collected prior to Russia’s invasion of Ukraine. Fears about Black Sea tensions were already weighing on agricultural markets before the violence erupted, but analysts warn that the prolonged conflict could have a serious impact on grain exports. More

The FAO said its vegetable oil index rose 8.5% m/m in February, posting another all-time high, boosted by higher prices for palm, soybean and sunflower oil. Ukraine and Russia account for about 80% of world exports of sunflower oil.

The grain price index rose 3.0% MoM, with corn prices up 5.1% and wheat prices up 2.1%, largely reflecting uncertainty over global supply flows from Chernoye ports. seas. More

The FAO Dairy Price Index rose 6.4% for the sixth consecutive month, helped by a shortage of global stocks, while meat prices rose 1.1% in February.

By contrast, sugar was the only index to decline, shedding 1.9% month-on-month, partly due to favorable manufacturing prospects in major exporters India and Thailand.

FAO also published its first forecasts for cereal production in 2022, suggesting that global wheat production will rise to 790 million tons from 775.4 million in 2021, thanks in part to hopes for high yields and extensive plantings in Canada, the US and Asia.

However, the UN agency warned that its forecasts do not take into account the possible impact of the conflict between Russia and Ukraine.

FAO said Argentina and Brazil’s 2022 maize crops are projected to be well above average, especially in Brazil, where maize crops hit a record high of 112 million tonnes.

Global cereal consumption in 2021/22 is projected to grow by 1.5% compared to 2020/21 levels to reach 2.802 billion tonnes. The FAO forecast for global cereal stocks by the end of the 2022 season was 836 million tons.

Edited by Crispian Ballmer

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