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Global food import costs are expected to reach nearly $2 trillion this year, more than expected, the UN Food and Agriculture Organization (FAO) said in a report released on Friday.
The new forecast of $1.94 trillion would represent an all-time high and a 10% increase from the 2021 all-time high.
However, the pace of growth is expected to slow due to rising food prices and depreciating currencies against the US dollar, according to the latest Food Outlook report.
“Warning signs”
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Food prices rose worldwide after Russia invaded Ukraine, but fell somewhat.
Together, these countries produce around 30% of all wheat exports, in addition to other cereals and related foodstuffs.
Although most of the increase in the global food import bill is attributable to the richest countries, the rise in food prices has disproportionately affected the poorest countries.
Overall food import costs for low-income countries are expected to remain virtually unchanged, although they are expected to decrease by 10% in volume, indicating growing affordability issues for these countries.
“These are alarming signs from a food security perspective that importers are struggling to finance rising international costs, potentially signaling the end of their resilience to rising international prices,” FAO said. .
Deepening differences
The Food Outlook report warns that existing differences are likely to widen.
High-income countries will continue to import the full range of food products, while their counterparts in developing countries will increasingly focus on basic necessities.
Last month, the International Monetary Fund (IMF) approved a new food shock window to provide emergency financing to low-income countries.
The FAO hailed the move, calling it an important step to ease the burden of soaring food import costs.
Agriculture-related imports
The report also assesses expenditure on imported agricultural inputs.
This year, the global bill is expected to jump nearly 50% to $424 billion, some 112% from 2020, mainly due to rising energy costs and imported fertilizers.
“The negative repercussions on global agricultural production and food security” are expected to last until 2023, the FAO said.
The raw materials puzzle
The Food Outlook Report is published twice a year by the agency’s Markets and Trade Division.
It also contains market supply and usage trends for products such as cereals, oils, sugar, meat, dairy and fish.
Currently, supplies are near record highs, although several factors point to tighter markets ahead.
For example, global wheat production is expected to reach a record 784 million tonnes in the coming year, boosted by a large harvest recovery in Canada and Russia.
While this is expected to push global wheat stocks to record highs, the report says accumulations are expected mainly in China and Russia, while stock levels are expected to fall by 8% in the rest of the world.
THE SOURCE: UN news
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