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HIGHLIGHTS
- World Bank president David Malpass has said the world is facing a 'human catastrophe' from the food crisis.
- Food prices in the UK climbed by 5.9% in the year to March 2022, highest since September 2011.
Food prices across the world have hit a record high as the conflict between Russia and Ukraine has cut off supplies from the latter, which is the world's largest exporter of sunflower oil and also a major producer of grains. This has raised the prices of alternatives and sent shocks through the markets for staples such as wheat and vegetable oils. According to the UN Food Prices Index, which tracks the most-traded food commodities across the world, the prices are now at their highest since the records began 60 years ago. While they were already at 10-year highs before the conflict, they climbed by almost 13% in March.
This has led to concerns by World Bank president David Malpass, who said that the world faces a 'human catastrophe' from the food crisis. During an interview with a news outlet, he said that millions of people would be pushed into poverty and lower nutrition if the crisis continues.
As per the World Bank, food prices could jump by a whopping 37%.
© 2022 Kalkine Media®
What is the situation in the UK?
In March, the UK saw the highest inflation rate in 30 years with the consumer price index (CPI) climbing to 7.0%, surpassing the 6.2% increase in February. According to the data from the Office for National Statistics (ONS), prices for food and non-alcoholic beverages climbed by 5.9% in the year to March 2022, which is the highest yearly rate for the category since September 2011. The prices of wheat in the country are 39% higher than they were a year ago, as per the Agriculture and Horticulture Development Board.
Grocery prices in February increased at their fastest rate in over eight years as food inflation touched 4.3% in the month, a news report citing market experts claimed. Recently, supermarkets Morrisons and Waitrose started limiting the amount of cooking oil that could be purchased to two bottles per customer amid fears of shortage as supplies have been disrupted due to the Ukraine crisis.
Notably, the conflict has put additional pressure on food producers in the country, who were already struggling with the after-effects of the Covid-19 pandemic and Brexit.
The road ahead
UK households are looking at months of sharp hikes in food prices due to the disruption of supplies from Ukraine, industry leaders have warned. Official numbers released last month showed that food price inflation is now gaining pace and is likely to accelerate further.
© 2022 Kalkine Media®
The most affected will be the poor people who are barely able to afford food now. When they face higher food prices, they will not be able to pay for it.
The hikes will also have knock-off effects on the prices of a variety of staple goods and exacerbate the cost of living crisis, putting about 1.3 million people at the risk of being pushed into absolute poverty.
