Food is over 27% more expensive than it was between 2014-2016

Must Read

- Advertisement -

Globally, food is more than 27% more expensive than it was between 2014-2016. As a result of the pandemic, food prices actually fell initially, but now with markets back on track, prices are rising faster than ever.

The wholesale price of food initially fell during the COVID-19 pandemic but has since risen steeply, according to the global FAO Food Price Index. One of the main drivers in price rises is palm oil. Global cereal prices also showed a significant bump in the past months.

After the wholesale price of food initially slumped during the coronavirus pandemic, the global FAO Food Price Index has shown a steep increase since the fall. Most recently, food around the world was more than 27 percent pricier than the 2014-2016 average, on which the index baseline of 100 points is calculated. The May figure is the highest of any month in almost ten years.

Food trade FOOD FORTIFICATION World food prices rise for 7th month in a row in December

Palm oil prices have been driving the increase in the index since the fourth quarter of 2020, but global cereal prices also showed a significant bump in the past months, together creating a level of food prices not seen in a decade.

- Advertisement -

Dry weather and production disruptions due to COVID-19 coupled with high global demand led to the depletion of palm oil inventories, in turn driving up prices. As transportation picked up again, biodiesel demand led to an increased need for soyoil. Both developments caused prices for vegetable oils to exceed the 2014-2016 average by almost 75 percent in May.

Read Also:  COVID-19: FG Flags-Off Distribution of Agricultural Inputs to Avert Food Scarcity in 2021 (Photos)

Food
Food around the world was more than 27 percent pricier than the 2014-2016 average.
Image: Statista

For cereals, strong demand from China increased prices, especially for sorghum, barley and corn. Worsening crop prospects in Latin America have also contributed to the increase in maize prices.

Speculation about whether the disruptions of the coronavirus pandemic would drive up food prices have been abound, but due to the COVID-related economic downturn and falling out-of-house demand, they actually decreased at the start of 2020, reaching a low one year ago.

- Advertisement -

According to the U.N., falling mineral oil prices also factored into the initial deterioration of food prices as many alternative fuels, which are made out of food stocks, saw demand fall. As the crisis wore on and some countries reopened at least temporarily, global demand and prices started to pick up again in the summer of 2020.

Read Also:  November Annual Inflation Rate Leaps to 11.85% on Increasing Food Prices in Sokoto, Kebbi, Ekiti

As the example of palm oil inventories shows, COVID-related disruptions (or those in which COVID-19 is a factor) do have the power to let prices trend upwards in the current market environment.

- Advertisement -
spot_imgspot_img

Subscribe to BrandSpur Ng

Subscribe for latest updates. Signup to best of brands and business news, informed analysis and opinions among others that can propel you, your business or brand to greater heights.

- Advertisement -

LEAVE A REPLY

Please enter your comment!
Please enter your name here

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Latest News

Visa Currencycloud

Visa to Acquire London fintech Currencycloud for £700M

07/22/2021 - Visa today announced it has signed a definitive agreement to acquire Currencycloud, a global platform that enables banks and fintech to provide...
- Advertisement -
spot_imgspot_img

Latest News

Visa to Acquire London fintech Currencycloud for £700M

07/22/2021 - Visa today announced it has signed a definitive agreement to acquire Currencycloud, a global platform that enables...
- Advertisement -
BrandsPur Weekly Cartoons
- Advertisement -spot_imgspot_img