Global food prices at highest point in a decade - UN

The UN's Food and Agriculture Organisation (FAO) has revealed that 2021 saw food prices spike far higher than in 2020 to their highest point since 2011, increasing by around 28% on the year prior.

Driven by uncertain economic conditions and the global pandemic, the organisation has issued a warning that 2022 may not see a return to normalcy.

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December saw a 0.9% decrease in prices from November but was still up 23.1% in December 2020. Only the dairy industry saw an increase in December, based on the indices tracked by the FAO, which measures monthly changes in prices of commonly-traded food commodities.

“While normally high prices are expected to give way to increased production, the high cost of inputs, ongoing global pandemic and ever more uncertain climatic conditions leave little room for optimism about a return to more stable market conditions even in 2022," FAO Senior Economist Abdolreza Abbassian said in a statement.

The prices for wheat and maize were driven by concerns over persistent dryness in the southern hemisphere, the FAO claims, with its Cereal index reaching its highest peak since 2012, offset in November - where it saw a 0.6% decrease - by strong demand and better-than-expected harvests. The price of rice reportedly dropped by 4% year on year.

The Omicron variant of the coronavirus possibly had an effect on sugar prices, alongside a weaker Brazilian Real and rising ethanol prices, climbing 29.8% in December.

The FAO's Meat index remained relatively stable throughout the year but still managed to climb by around 12% from 2020.

Inflation of the US Dollar mixed with uncertain economic conditions has also driven up food prices in North America. According to the Bureau of Labour Statistics, food prices rose by 5% in the US in November 2020, reaching their highest peak since June 1982.

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In the UK, food inflation rose by 2.1% in October and has continued to climb since then, exacerbated by both the pandemic and the shortage of delivery drivers.

In the EU, food prices continued to shoot up throughout 2021, following a dip in April, but have yet to reach the peaks found at the height of the pandemic.

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