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War in Ukraine, Drought Pushed Global Food Prices to All-Time High in 2022 – Kenny Stancil

Russia’s war on Ukraine, climate change-intensified drought, and other factors drove global food prices to a record high and worsened hunger around the world in 2022, the United Nations Food and Agriculture Organization said Friday.

The FAO Food Price Index—which tracks monthly changes in the international prices of grain, vegetable oils, and other commonly traded food commodities—averaged 143.7 points last year. That marked the highest level since records began in 1961 and an increase of 14.3% over the 2021 average, according to the Rome-based U.N. agency.

As The Associated Pressreported:

Russia’s invasion of Ukraine in February exacerbated a food crisis because the two countries were leading global suppliers of wheat, barley, sunflower oil, and other products, especially to nations in parts of Africa, the Middle East, and Asia that were already struggling with hunger.

With critical Black Sea supplies disrupted, food prices rose to record highs, increasing inflation, poverty, and food insecurity in developing nations that rely on imports.

The war also jolted energy markets and fertilizer supplies, both key to food production. That was on top of climate shocks that have fueled starvation in places like the Horn of Africa. Ethiopia, Somalia, and Kenya are badly affected by the worst drought in decades, with the U.N. warning that parts of Somalia are facing famine. Thousands of people have already died.

In the month of December, the FAO Food Price Index fell to an average of 132.4 points, a slight decrease from the previous year. The U.N. attributed most of the decline to a recent drop in the price of palm, soy, rapeseed, and sunflower oils. Lower vegetable oil prices, which hit an all-time high in 2022, came as a result of reduced global import demand, expectations of a seasonal boost in soy oil production in South America, and declining crude oil prices, according to the FAO.

While world prices of wheat and maize surpassed previous records in 2022, the price of both cereals declined slightly in December, the organization said, thanks to ongoing harvests in the Southern Hemisphere, which increased global supply.

The price of rice, however, rose last month, as did the price of sugar and cheese, FAO noted. Beef and poultry prices fell slightly in December, but that came at the end of a year in which dairy and meat prices reached their highest levels since 1990.

“Calmer food commodity prices are welcome after two very volatile years,” FAO Chief Economist Maximo Torero said in a statement. “It is important to remain vigilant and keep a strong focus on mitigating global food insecurity given that world food prices remain at elevated levels, with many staples near record highs, and with prices of rice increasing, and still many risks associated with future supplies.”