World Food Prices Hit Three-year Record in 2020
OREANDA-NEWS. As the Food and Agriculture Organization of the United Nations reported on January 7, based on the FAO Food Price Index, which reflects monthly changes in international prices for staple foods, world prices for basic foods and raw materials in 2020 were the highest in the last three years.
This figure rose to 107.5 points in December, up 2.2% compared to November, when the index was recorded at the highest level in almost six years. The average for the 2020 index is 3.1% higher compared to 2019. However, as indicated in a report by the Food and Agriculture Organization of the United Nations, it is 25% lower than the historical record index recorded in 2011.
In particular, the vegetable oil price index increased by 4.7% in December, reaching its highest level since September 2012. The grain price index also continued to grow, increasing by 1.1% compared to November and by 6.6% compared to the average level in 2019. As experts explain, the upward trend in export prices for wheat, corn and rice is dictated by uncertainty about the projected high yields and weather conditions in the Americas, as well as in Russia. The price index for dairy products, which increased by 3.2% in December compared to November, has been increasing for seven months in a row due to increased demand against the background of high domestic consumption of this type of product in the producing countries.
At the same time, experts from the UN Food and Agriculture Organization are not inclined to associate the increase in food prices only with the pandemic, which mainly led to some interruptions and delays in supplies. According to experts, price dynamics depends on the ratio of supply and demand.