Global food prices hit new record high of 13% – FAO

The Food and Agriculture Organization (FAO) has disclosed that world food prices rose by nearly 13 percent in March, hitting a new record high.

The organization revealed this in its food price index for March, released at the weekend, which tracked the most globally traded food commodities.

This is as the Russian-Ukrainian war continues to disrupt the global market for staple grains and edible oils.

According to the report, the price index averaged 159.3 points in March above the previous 140.7 in February, which was a record at the time.

The report revealed that the six-week-old war in Eastern Europe had stalled Ukrainian exports, adding that Russia and Ukraine were major exporters of wheat, corn, barley and sunflower oil via the Black Sea and Moscow.

“Disruption to supplies of crops from the Black Sea region has exacerbated price rises in food commodities, which were already running at 10-year highs in the FAO’s index before the war in Ukraine due to global harvest issues.

“Cereal price index climbed 17 per cent in March to a record level while the vegetable oil index surged 23%, Sugar and dairy prices rose sharply in March,” the report read in part.

Meanwhile, the FAO cut its projection of world wheat production in 2022 to 784 million tonnes, from 790 million, as it factored in the possibility that at least 20 percent of Ukraine’s winter crop area would not be harvested.

Similarly, the agency lowered its projection of global cereals trade in the 2021/22 marketing year as increased exports from Argentina, India, the European Union and the United States are expected to only offset some of the disruptions to Black Sea exports.

The agency noted that the total cereal trade in 2021/22 was revised down by 14.6 million tonnes from the previous monthly outlook to 469 million tonnes, now 2 percent below the 2020/21 level.

Also, the projected world cereal stocks at the end of 2021/22 were revised up by 15 million tonnes to nearly 851 million tonnes, mainly because of expectations that export disruption will lead to bigger stockpiles in Ukraine and Russia.

Source: AgroNigeria