Los world prices of basic foods increased in March for the second consecutive month, up 2.4%due to the rise in the cost of energy that has caused the escalation of the conflict in the Middle East. Thus, cereals, meat, dairy products, vegetable oils and sugar rose last month, on the one hand, due to the behavior of the market at this time of year, but also due to how energy prices have impacted, as reported by the Food and Agriculture Organization of the United Nations (FAO) in its monthly report. This second rebound is beginning to worry experts, who fear that if the war continues the bill will skyrocket.
“Although price increases since the conflict began have been moderate, driven mainly by higher oil prices and cushioned by the abundant global supply of cerealsIf the conflict extends beyond 40 days, farmers will have to choose between growing the same thing with fewer inputs, planting less or switching to less intensive crops that require fertilizers,” warned the FAO chief economist, Maximum Bullfighter. “These decisions will affect future yields and determine our food supply and raw material prices. for the rest of this year and all of next“Torero added.
“If the Strait of Hormuz remains closed for more days, the consequences on food production and prices may be more serious than the crisis experienced during the covid-19 pandemic if we are not careful,” the specialist added. The FAO food price index last month averaged 128.5 points in March, 2.4% more than in February and 1% more than a year ago, as reported this Friday by the organization in a statement.
By food types, cereals became more expensive by 1.5% compared to the previous month, an increase that affected all the main varieties, with the exception of rice. Wheat, a key food in Western countries and the entire Arab area, rose 4.3%, due to drought affecting the central United States and by expectations of a reduction in planted area in Australia, in response to the expected increase in fertilizer costs. World corn prices rose slightly, while the price of rice decreased by 3%due to the harvest season, lower demand for imports and the depreciation of the currency against the US dollar.
FAO warns of a “cascade effect” in the price crisis due to the situation in Hormuz / FAO
Oil and pork
The index of FAO oil prices increased by 5.1% compared to February, reaching 13.2% above its level last year. The one from the meat, for its part, increased by 1% compared to the previous month, mainly due to the increase in pork prices. The price of beef also increased, but, to compensate, sheep and poultry meat fell. Pork prices experienced a sudden rise, because we are entering a time of year in which consumption is growing.
He price of dairy products rose 1.2%, driven mainly by higher milk powder quotes amid a seasonal decline in supplies in Oceania, and sugar rose 7.2% in March. Regarding sugar, a product that had been declining for a few months (also in Spain, according to the CPI) this March reached its highest level since November. The FAO attributes this directly “to the influence of the rise in international crude oil prices, which generated expectations that Brazil, the world’s leading sugar exporterwill resort to a greater extent to ethanol produced from sugar cane in the next harvest.
Subscribe to continue reading
