World prices for the main agricultural crops are rising: there is a risk of rising prices of products
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Prices for staple crops are rising, raising the risk of food inflation, which remains uncomfortably high in some parts of the world.
This is reported by the Bloomberg agency.
Palm oil, used in many food products, hit a 17-month high, robusta coffee futures are at their highest since at least 2008, and white corn prices are up more than 30% this year.
The main reason for the recent increase in prices is unfavorable weather conditions, which reduce the harvest and limit the supply. While it will take time for changes in wholesale prices to trickle down to retail, rising prices could bring an end to a long slump in food prices and mean that consumers will eventually feel those increases in supermarkets and not just on chocolate bars.
In its report for the end of March, the World Bank noted that in more than 60% of the 167 most recently assessed countries, food inflation exceeds general inflation.
In Vietnam, heat waves are hitting robusta coffee growing regions. Production problems are also compounded by farmers switching to alternative crops such as durian and avocado. This has contributed to a nearly 70% increase in the price of robusta (which is used to make espresso and instant coffee) over the past year.
Meanwhile, drier-than-usual weather is weighing on prospects for South Africa’s maize crop. Threats of shortages have boosted white corn prices and could lead to significant imports of the staple (used to make cornmeal) for the first time since 2017.
Also worth noting is palm oil, the world’s most common vegetable oil, used in everything from candy and cookies to lipstick. Concerns about lower-than-expected supplies from the two biggest producers, Indonesia and Malaysia, lifted palm oil futures to their highest since 2022.
Another grain that attracts attention is wheat. While record harvests in Russia have helped push global prices down from record highs in 2022, geopolitical risks remain as Russia continues its incursion into Ukraine and both sides launch strikes on infrastructure.
“Ukraine’s resilience in maintaining agricultural production in the face of war underscores its role as a global supplier, but prospects for peace remain uncertain, exacerbating market volatility,” the World Bank report said.
Read also: Chocolates are becoming more expensive and smaller. Why is there not enough cocoa in the world?
We will remind:
Cocoa bean futures jumped to a record high of more than $10,000 per ton, continuing a historic rally that has already doubled prices this year and could weigh on chocolate prices.
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