Poster in Jan 21, 2023 16:37:26

World Bank report: Food prices will be high this year too

World Bank report: Food prices will be high this year too

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Food inflationary pressures are not abating. According to the updated data from the World Bank, the food inflation rate was high in most countries of the world in the last quarter of 2022. Organizations like World Bank and IMF think that food prices will remain high this year as well.

Zimbabwe had the highest food inflation in the last quarter of 2022. The real food inflation rate in the country stood at 121 percent, compared to the same quarter of 2021. Next is Lebanon, whose food inflation rate was 29 percent.

According to the data of the World Bank, food prices in the world market are still somewhat stable from December 2022 to this January. The agricultural index of the organization is the same. Maize and wheat prices fell by 1 and 2 percent respectively. However, the price of rice increased by 1 percent. However, in the current month of January, the price of corn and rice in the world market is 8 and 13 percent higher than in the month of January 2022.

Meanwhile, it was learned last week that in December, the food price inflation rate in developed countries like the United Kingdom was 16.3 percent, which is the highest in 46 years. Inflation rates have been high in developed countries including the UK for a year, especially food inflation. As a result, private organizations like Save the Children in the UK have undertaken various programs.

2022 was an overall high inflation year. Inflation reached record highs in almost all countries of the world as a result of the Russia-Ukraine war. There was no end to the misery of people especially due to food inflation. According to Reuters news, food prices were the highest in 2022 after 1990.

The Food and Agriculture Organization of the United Nations (FAO) publishes the Food Price Index every month. It showed that the average value of FAO's food price index in 2022 was 143.7 decimal points. This is the highest level since FAO introduced the index in 1990. According to the index, the price index value increased by 18 points in 2022 compared to 2021. As a result, food inflation has reached 14.3 percent in 2022. Food prices have not increased at the same rate in all countries. Again, the impact of the increase in food prices is not the same in all countries.

Food transport was disrupted in March-April 2022 due to the Russia-Ukraine war. As a result, FAO prices rose to record highs. In March of that year, the food price index rose to a maximum of 159.7.

Then till April, May and June, it was 158.4, 158.1 and 154.7 respectively. In August, it fell to 140 in one fell swoop. After that, food prices continued to fall. Last December it came down to 132.4. The overall average value for the year stands at 143.7.

The world's largest wheat-producing countries are Russia and Ukraine. After the start of the war, Ukraine could not export wheat for several months. As a result, the price of wheat has increased a lot all over the world including in Bangladesh. In addition, due to the increase in the price of fuel due to the war and the disruption of the supply system, inflation rose again.

Also, in 2022, it will be very hot almost everywhere in the world. Not only Bangladesh has suffered from extreme heat, but the whole world has suffered. Wildfires spread across Europe. A video of people frying eggs in the sun in the UK has gone viral on social media. High heat has disrupted food production in many countries. Analysts say that the world is becoming like a burning furnace. UN Secretary-General Antonio Guterres said in this context, "Mankind is moving towards suicide."

According to the World Bank report, the price of fertilizers tripled after 2020. Although farmers in developed countries will not have much problem, small farmers in low and middle-income countries will suffer. Agricultural production will be disrupted. The World Bank believes that the food cycle will be destabilized in 2023 and 2024. It has affected 20.5 crore people in 45 countries of the world. Sub-Saharan regions are particularly mentioned. Countries in the region import fertilizers directly from Russia and Belarus. They will not get fertilizer due to the ban. Again, as Europe stops receiving Russian gas, the cost of fertilizer production will also increase.

In this context, the International Monetary Fund (IMF) thinks that food prices in the world will remain high in the current year 2023. War, high fuel prices, extreme weather—these are the reasons they identify. As food insecurity increased due to record food price hikes last year, so did social unrest. There is pressure on the budget of food-importing countries.

According to the research of the South Asian Network on Economic Modeling (SANEM) a private research institute of the country, the majority of the expenditure of low-income or poor people goes towards food. Urban marginal groups spend an average of 61.31 percent of total expenditure on food. In the case of rural marginalized groups, it is 65.36 percent. This is more or less the case everywhere in the world. The situation is such that even people in developed countries like the UK are struggling to meet food costs. Many people are reducing the amount of food on their plates - such news is being published in various media.

A study by the International Food Policy Research Institute (IFPRI) has shown that children will suffer in the first 1,000 days of life due to food inflation. This will disrupt the development of children from rural landless families in low and middle-income countries. As their education will be disrupted due to an increase in food prices, their future employment will also be affected. As a result, they will not be able to fully develop life.

Source:
Online/GFMM

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