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Global food prices hit record levels in 2022 amid drought and war

Russia’s war in Ukraine, drought and other factors have led to higher inflation and increased hunger around the world.

Rome, Italy. Global prices for food commodities such as grains and vegetable oils were the highest on record last year, even after falling for nine consecutive months, the UN Food and Agriculture Organization said as Russia’s war in Ukraine, drought and other factors led to rising inflation and increased hunger around the world.

The FAO Food Price Index, which tracks monthly changes in global prices for widely traded food commodities, fell 1.9% in December from the previous month, the Rome-based organization said Friday. For the full year, it averaged 143.7 points, more than 14% above the 2021 average, which also increased significantly.

The December decline was driven by falling vegetable oil prices on the back of reduced import demand, expectations of higher soybean oil production in South America and lower crude oil prices. Grains and meat also declined, while dairy and sugar rose slightly.

“After two very volatile years, we welcome calmer food prices,” FAO Chief Economist Maximo Torero said in a prepared statement. “It is important to remain vigilant and pay close attention to mitigating the effects of global food insecurity, given that global food prices remain elevated, many staples are close to record highs, rice prices are rising and there are still many risks, related to future deliveries. ”

Last year, the United Nations Food Price Index reached its highest level since it began recording in 1961, according to FAO.

The Russian invasion of Ukraine in February exacerbated the food crisis, as the two countries were the world’s leading suppliers of wheat, barley, sunflower oil and other products, especially to countries in Africa, the Middle East and Asia that were already battling famine.

Disruptions to critical Black Sea supplies have pushed food prices to record highs, fueling inflation, poverty and food insecurity in import-dependent developing countries.

The war also shook up energy markets and fertilizer supplies, which are key to food production. This was on top of the climate shocks that caused famine in places like the Horn of Africa. Ethiopia, Somalia and Kenya have been hit hard by the worst drought in decades, with the UN warning parts of Somalia are at risk of famine. Thousands of people have already died.

Prices for wheat and corn reached record highs last year, although they fell in December along with the cost of other grains, the FAO said. It says Southern Hemisphere crops have boosted supplies and there is strong competition among exporters.

The organization’s vegetable oil price index hit a record high last year, despite falling to its lowest level since February 2021 in December. For all of 2022, the FAO Dairy Price Index and Meat Price Index were also the highest since 1990.

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