Food prices around the world fell for the fifth month in a row

Food prices around the world fell for the fifth month in a row
Food prices around the world fell for the fifth month in a row

The United Nations food price index fell for a fifth consecutive month in a sign that one of the main drivers of inflation around the world may be weakening.

The index fell to 138 points in August and is now lower than it was before Russia’s invasion of Ukraine, according to data from the UN’s Food and Agriculture Organization, cited by the BBC. Both countries are leading exporters of agricultural crops, including sunflower oil, corn and wheat.

The agreement on the reopening of Ukrainian ports, concluded in July this year with the mediation of the United Nations, has reduced the prices of cereals and vegetable oil, the organization noted. This means that more supplies have been able to reach international markets.

Cereals have been the “main driver” of this year’s growth in food prices, but according to Erin Collier of the UN’s Food and Agriculture Organization, supplies are now increasing mostly because of good harvests, especially in Canada, the United States and Russia, which are major exporters of wheat.

The easing of export restrictions has helped lower sugar and oil prices, while weaker demand for certain products has put pressure on meat and dairy prices, Collier added.

The price of food is one of the biggest causes of inflation in the world.

The eurozone reported annual inflation of 9.1% in August, with energy the biggest contributor with an increase of 38.3%, but unprocessed food next at 10.9%. The latest UK and US inflation figures paint a similar picture.

Germany lowers the price of energy with taxes on excess profits Germany’s government will use revenue from taxes on excess profits of companies profiting from the energy crisis to lower consumer prices for gas, oil and coal

“The growing risk of a recession has heightened concerns that demand for foods such as corn, meat, vegetable oils and other products will fall,” said ED&F Man analyst Kona Hack.

However, due to ongoing supply chain issues and the time it takes for prices to change, she predicts that not all countries will feel the benefit of these lower prices immediately.

The global food price index fell sharply from March’s record high of 159.7 points, but remains 10 points above its level a year ago.

Ukraine’s Agriculture Minister Mykola Solsky warned this week that the upcoming harvest will suffer because of the war. The areas for planting wheat and barley for next year are expected to decrease by at least 20% due to the Russian invasion. The Ukrainian Agrarian Council also warned that the lack of funds would reduce production.

The UN’s Erin Collier told the BBC that even after the latest drop in global food prices in recent months, they remain higher than during the 2011 peak.

“Right now, there are a lot of factors that are still keeping prices high. These include skyrocketing energy prices, fertilizers that remain very expensive for farmers, and supply uncertainty,” she says.

According to her, despite the opening of some Ukrainian ports, the situation remains uncertain, and the volumes of trade through the Black Sea are still very small.

The article is in bulgaria

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