UN experts: prices on the world food market will grow for all products

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UN experts: prices on the world food market will grow for all products
UN experts: prices on the world food market will grow for all products
12 November, 18:38EconomyPhoto: Яндекс.Карты
According to FAO forecasts, food prices will continue to rise in the global market in 2021-2022. Moreover, almost all basic foodstuffs will rise in price.

Gennady Charodeyev

Experts from the Food and Agriculture Organization of the United Nations in their report note: the volume of global food imports by 2022 will reach a record level of 1.75 trillion, dollars, which is 14% more than in 2020, and 12% higher than predicted in June 2021 year.

Experts explain this jump in prices by an increase in the cost of food products on the international market, as well as a threefold increase in transport costs. As noted in the FAO report, the developing regions of the world account for 40% of total imports.

Experts estimate that the total value of food imports will increase by 20% compared to last year. However, in low-income, food-deficit countries, prices are expected to rise even more rapidly in the near term. To a large extent, it is due to higher costs, and not an increase in food imports, as some economists believe.

“Developing regions are facing skyrocketing prices for basic foodstuffs such as grains, animal fats, vegetable oils and oilseeds. In developed countries, price increases have been observed mainly in high value-added product categories such as fruits and vegetables, fish products and beverages, ”the FAO report says.

The FAO Food Price Index has been growing over the past year. In June and July, the first decline in 12 months was recorded, but in August the upward trend returned, which has been held for the third month in a row.

As the authors of the FAO report explain, prices are formed from the ratio of supply and demand, which began to rise after declining with the onset of the pandemic.

In an interview with NI , the director of the FAO Moscow office, Oleg Kobyakov , in particular, said:

- World food prices climbed to a new peak, exceeding the July 2011 level. Their stable growth for the last one and a half to two years is a fait accompli, which has a rational explanation. As I see it, there are three main reasons for the rise in food prices.

Firstly, the negative consequences of climate change affecting the yield of the main food crops (droughts, floods, fires, pest infestations). Secondly, armed conflicts leading to human and material losses in the agricultural sector, breaking food chains. Third, shake-ups in related sectors of the economy (rising prices for energy carriers, fertilizers, and other inputs). In 2021, the pressure of these factors on the agricultural sector was very noticeable. It is they, and not the "collusion of monopolies" or "the greed of sellers" that determine the value of our food basket, Oleg Kobyakov believes.

- Anti-driver action is exacerbated by the ongoing COVID-19 pandemic. It continues to undermine the economic stability and prosperity of many countries, including through lockdowns, dramatically reducing incomes of the population, causing bankruptcy of enterprises, spurring inflation, disrupting food trade. FAO maintains a regular Food Price Index. Our experts note that in October, compared with the previous month, the prices for cereals increased by 3.2 percent, the prices for wheat jumped by 5 percent. Oil prices rose by 9.6% over the month and reached their highest level ever since the Index was compiled. In turn, higher grain prices are pulling prices for meat and dairy products.

- It should be borne in mind that Russian prices in many cases follow world ones, and this is not surprising, since the food market is very internationalized: every fifth food calorie, before getting on our table, crosses at least one state border. In the world, as in Russia, in general, the named product groups are also getting more expensive. True, the numbers may differ: for example, we have a more tangible increase in prices for vegetables and fruits due to the seasonality factor, - Oleg Kobyakov, director of the FAO Moscow office , told Novye Izvestia.

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