Food Prices Reached A 10-Year High In 2021

“Worldwide food prices rose 28% in 2021 and reached a 10-year high, and hopes for a return to more stable market conditions this year are slim,” the UN food agency said on Thursday. The Food and Agriculture Organization's (FAO) food price index, which tracks the most traded food commodities globally, averaged 125.7 points in 2021, the highest level since 131.9 in 2011. The monthly index declined slightly in December, but has risen in the last four consecutive months, driven by disruptions to the harvest last year and strong demand. As economies recover from the coronavirus crisis, higher food prices have caused a wider rise in inflation, and FAO has warned that high costs are putting poor populations at risk in import-dependent countries. In its latest update, the food agency has been cautious about whether price pressures will ease this year. In a statement, FAO economist Abdolreza Abbassian said, "While normally high prices are expected to give way to production growth, high input costs, the ongoing global pandemic and even more uncertain climate conditions leave little room for optimism about a return to more stable market conditions, even in 2022." A rise in fertilizer prices, in turn linked to rising energy prices, has increased the cost of so-called inputs used by farmers to produce crops, raising doubts about yield prospects for next year's harvest. Monthly update released by the agency stated that in December, prices for all categories in the food price index bar dairy products fell, while vegetable oils and sugar fell significantly.