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World Food Prices Hit New High – FAO

According to the UN Food and Agriculture Organization (FAO), global food prices reached an all-time high last month as a result of shortages of grain and edible oils caused by the crisis in Ukraine.

“World food commodity prices increased by a significant amount in March, reaching their highest levels in history, as war in the Black Sea region spread shocks throughout markets for staple grains and vegetable oils,” the Food and Agriculture Organization of the United Nations (FAO) said in a statement.

The FAO’s food price index increased by 12.6 percent to a record 159.3 points in March, surpassing the previous record of 141.4 points set in February. The index has “made a huge jump to the new highest level since its creation in 1990,” according to the FAO. The index is a measure of the change in worldwide prices of a basket of food items over a certain period of time each month.

According to the agency, the current climb includes new all-time highs for vegetable oils, cereals, and meats, as well as “substantial increases” in the costs of sugar and dairy goods.

The Food and Agriculture Organization of the United Nations (FAO) has warned that the Russian-Ukrainian conflict might cause food and feed prices to rise by up to 20% higher, resulting in an increase in global malnutrition.

Besides wheat, maize, barley, and sunflower oil, Russia and Ukraine are the world’s leading exporters of all of these commodities. Exports from Ukraine have been halted, and sanctions imposed on Russia may have an impact on the country’s own grain shipments, since Black Sea ports used to import grain remain closed. It is anticipated that the present turmoil will have an impact on the planting season in Ukraine, according to industry experts.

Ngozi Okonjo-Iweala, the director-general of the World Trade Organization (WTO), warned earlier this month that the scenario might lead to starvation and food riots in impoverished nations, particularly in African countries. She went on to say that food imports from the Black Sea area were critical to the existence of 35 African countries.

As part of its revised prediction for world wheat output in 2022, the Food and Agriculture Organization of the United Nations (FAO) reduced its previous estimate of 790 million tons to 784 million tons, noting the potential that at least 20% of Ukraine’s winter crop area may not be harvested. As a result of the difficulties in Black Sea shipments, it has also reduced its prediction for worldwide grains trade in the current marketing year. The agency did point out, however, that increased exports from India, the EU, Argentina, and the United States might somewhat counterbalance the downward trend.

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