World food prices were up sharply in 2021, and the pain for consumers is likely to extend into this year as well, according to the Food and Agriculture Organization (FAO) of the United Nations.
The FAO food price index – which tracks monthly changes in the international prices of commonly-traded food commodities – averaged 125.7 points for 2021 as a whole, more than 28% above the previous year and the highest in a decade, the organization said in a release Thursday.
Meanwhile, FAO Senior Economist Abdolreza Abbassian offered little hope of immediate relief, noting that while high prices might normally be expected to spur additional 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.”
Amid strong global demand and weather calamities that badly dented production in several parts of the world, including the Canadian Prairies, the FAO cereal price index reached its highest annual level since 2012 this past year, averaging 27.2% higher than in 2020. Corn led the way higher, climbing 44.1% year-over-year, while wheat gained 31.3%. On the other hand, rice prices declined by 4%.
The vegetable oil price Index reached an all-time high in 2021, increasing almost 66% from the previous year, while sugar rose nearly 30% to its highest level since 2016. The annual increase in in the FAO meat price index was more modest, rising 12.7% from 2020. Dairy gained almost 17%.
On a monthly basis, the FAO food price index averaged 133.7 points in December, a 0.9% decline from November but still up 23.1% from December 2020.