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<\/a><\/p>\nThe food price rally is felt most in poor countries where groceries make up a large share of consumer budgets — and the fallout from Russia\u2019s invasion has sent costs of basic foods like bread soaring. The United Nations\u2019 World Food Programme recently said expensive staples in import-dependent Middle Eastern and North African nations are putting people\u2019s resilience at a \u201cbreaking point.\u201d<\/p>\n
The surging costs are spurring some countries to hold off on imports, seek new suppliers or draw down local stockpiles, though that won\u2019t be a long-term fix, said Erin Collier, an economist at the UN\u2019s Food and Agriculture Organization.<\/p>\n
\u201cIt\u2019s basically kind of deterring demand,\u201d she said in an interview. \u201cThat can only last for so long. Wheat is a staple food.\u201d<\/p>\n
The FAO\u2019s gauge of global prices has jumped about 75% since mid-2020, eclipsing levels seen in 2008 and 2011 that contributed to global food crises. Last month\u2019s surge helped prices round out a seventh straight quarterly gain, the longest such run since 2008.<\/p>\n
The UN has warned that prices could still climb much more.<\/p>\n
That\u2019s bad news for the world\u2019s hunger problem. Cost increases stemming from the war and resulting sanctions on Russia will — without action — push more than 40 million additional people into extreme poverty, according to an analysis published last month by the Center for Global Development, a non-profit think tank whose funders include Bloomberg Philanthropies.<\/p>\n
Aside from the food-supply risks associated with the war in Ukraine, farmers around the world continue to contend with severe weather events and the impact of climate change. For example, the worst drought in decades is causing millions of livestock to die in the Horn of Africa, while global warming is making food insecurity more severe in places like Afghanistan.<\/p>\n
Supply Outlook<\/strong><\/p>\n The FAO raised its outlook for global grain stockpiles – usually a good sign for supplies – but said most of that is due to stranded grain in the Black Sea region. Ukraine\u2019s exports will be particularly hard hit from the war, with wheat shipments falling 5 million tons and corn down 12.5 million tons from a previous estimate. Freight and financing challenges are also impairing Russian sales.<\/p>\n The problems will also drag into the next season. Ukraine planted its wheat months before the war erupted, and the FAO expects at least 20% to go uncollected because of destruction, constrained access to fields or a lack of resources for harvests. Russian production could be affected by challenges importing agricultural inputs, it said.<\/p>\n \u201cLooking forward to 2022-23, we\u2019re already seeing signs that production is going to be reduced in Ukraine,\u201d Collier said. \u201cThe amount they\u2019re able to export really depends on how much longer this conflict continues.\u201d<\/p>\n
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