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Global food prices hit their highest level in a DECADE, and experts warn it could get worse


Worldwide food prices have reached the highest levels in a decade – and experts are warning that price spikes of up to 16 per cent in the US could worsen, partly because of soaring energy costs.

The United Nation’s Food and Agriculture Organization (FAO)’s September food price index – a measure of monthly changes in global food prices – reached 130 points, a level not seen since 2011.

It represents a 32.8percent increase from September 2020.

Prices are also skyrocketing in the US, where beef prices have jumped 12.2 percent during the past year, and the cost of bacon increased 17 percent, according to the US labor department.

Meat, poultry, fish, and eggs sold at an eight percent premium this year, with prices up 15.7 percent since August 2019.

A carton of eggs is likely to cost a shopper an extra 10 percent this year, a hike that’s being blamed on across-the-board rises to food costs in both nationally and worldwide

The price of bacon has increased by 17percent, according the US labor department

The price of bacon has increased by 17percent, according the US labor department

The cost of fresh fish and seafood jumped 10.7 percent, and eggs are setting shoppers back an extra 10 percent.

The dairy group was the only area that observed a decline, after falling 0.5percent year-over-year. 

David Ortega, associate professor and food economist at Michigan State University, said food prices will continue to be affected by a multitude of factors in the short-term.

The ongoing COVID-19 pandemic, climate change, and the law of supply and demand among the reasons he cited for the price spikes, he said.

David Ortega, associate professor and food economist at Michigan State University, says numerous factors are contributing to the price hikes shoppers are seeing in stores

David Ortega, associate professor and food economist at Michigan State University, says numerous factors are contributing to the price hikes shoppers are seeing in stores

‘Consumer behavior is changing and demand is increasing as consumers are starting to re-re-emerge from this latest surge of covid cases,’ Ortega told DailyMail.com. ‘There are some serious supply chain logistic issues which are affecting shipping and transportation times that are adding to rising costs. Labor shortages and rising wages are also partly to blame.’

Climate change is also playing a role, he added.

‘Hot and dry weather in North America, frost and severe drought in Brazil (major supplier of sugar, coffee, and animal feed worldwide, among other food related products),’ he said. ‘An energy crisis is also threatening this year’s fall harvest in China which is already underway and could add to rising costs worldwide.

‘So it’s really a wide range of factors coming together and compounding each other.’

He said food prices will continue to rise for the next few months, and that the long-term severity depends on the extent of harvest setbacks in some countries, and how fast the supply chain can catch up from previous disruptions.

Beef prices have jumped 12.2percent, joining other types of meats in becoming more costly

Beef prices have jumped 12.2percent, joining other types of meats in becoming more costly

The dairy group was the only listed US food category where a price decrease was observed

The dairy group was the only listed US food category where a price decrease was observed

Fresh fish has become nearly 11percent more expensive since about this time last year

Fresh fish has become nearly 11percent more expensive since about this time last year

Climbing energy costs are exacerbating the challenge, Bloomberg reported last month.

‘It’s this combination of things that’s beginning to get very worrying,’ FAO economist Abdolreza Abbassian told the outlet. ‘It’s not just the isolated food-price numbers, but all of them together. I don’t think anyone two or three months ago was expecting the energy prices to get this strong.

Rising food prices worldwide are being caused by tightening supplies and a growing demand for pantry staples such as wheat and palm, the FAO said.

The UN's Food and Agriculture Organization's food price increase has reached a 10-year high

The UN’s Food and Agriculture Organization’s food price increase has reached a 10-year high

This chart shows the rise and fall of food prices throughout the past three  decades

This chart shows the rise and fall of food prices throughout the past three  decades

Its index, which tracks monthly changes in commonly traded world food commodities, showed an up to 41 percent year-over-year jump in wheat prices.

‘Among major cereals, wheat will be the focus in the coming weeks as demand needs to be tested against fast rising prices,’ senior FAO economist Abdolreza Abbassian said in a press release.

The FAO’s vegetable oil price index ticked up 1.7percent last month, representing a 60 percent year-over-year increase caused by growing palm oil prices that reached a 10-year high because of growing demand and labor shortages, the organization said.

The global price of sugar rose 53.5 percent year-over-year, a jump attributed to bad weather and bolstered ethanol prices in Brazil, the world’s biggest sugar exporter.

Worldwide dairy prices were up about 15 percent year-over-year, an upswing driven by ‘solid global import demand’ and seasonal factors in Europe and Oceania, the FAO said.

Demand for butter was especially high.

The cost of meat remained unchanged month-over-month, but rose 26.3percent from the previous year.



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