Global food prices rise to highest ever levels in March

Global food prices rose to their highest ever levels in March as a result of Russia’s invasion of Ukraine, the UN has reported.

Cooking oils, cereals and meats hit all-time highs and meant food commodities cost a third more than the same time last year, according to the Food and Agriculture Organization’s monthly food price index published on Friday.

The Russia-Ukraine war has disrupted Black Sea exports of crucial commodities from a region that had been producing more than a quarter of the world’s wheat exports.

The war has helped push cereal prices up 17% over the past month with the closure of ports throttling wheat and maize exports from Ukraine. Russian exports have also been slowed by financial and shipping problems.

World wheat prices soared by 19.7% in March, while maize prices posted a 19.1% month-on-month increase, hitting a record high along with those of barley and sorghum.

The FAO said these problems were likely to persist, leading to higher prices, lower stocks and uncertainty in the wheat market in the future.

“The higher price quotations are particularly concerning for countries already struggling with other crisis, including conflict, natural disasters, economic conditions or, as it is often the case, some combinations of those,” said an FAO spokesperson, adding that countries with low incomes and food shortages may struggle to pay higher prices.

“[Price] increases are the most noticeable in the countries where the share in disposable income spent on food is the highest. In these cases, the most vulnerable are likely to skip meals, purchase less nutritious foods, or use other coping strategies, which will have longer-term effects on their health and wellbeing.”

Joseph Glauber, senior research fellow at the International Food Policy Research Institute, said before the invasion, prices were already near record highs because of limited global supplies.

“Projected stock levels were already low relative to recent years, which means that there are few supplies available to buffer the impacts of reduced exports coming from the Black Sea,” he said.

IFPRI estimates that Ukraine and Russia accounted for 12% of calories traded in the world.

Glauber said the volatility in food prices was being felt everywhere. Countries that were particularly reliant on wheat from Russia and Ukraine may have to switch to the EU, US, Australia, Canada and Argentina for wheat supplies.

“Many of these countries are in North Africa and the Middle East where wheat often accounts for as much as 35% of total calories consumed and a majority of the wheat is imported, much from the Black Sea,” he said.

The Black Sea region has also been a crucial source for sunflower oil and the limiting of exports has meant vegetable oil prices rising by almost a quarter since February. Prices also rose for palm, soy and rapeseed oils because of increased demand.

Earlier this week, the World Food Programme said the effect of blocked exports would hit several countries in East Africa, including Kenya, Ethiopia, Somalia and South Sudan – countries already experiencing severe drought and conflict.

WFP said the price of local foods had risen a quarter, on average, compared with last year but had been as high as 92% in Sudan.

It also warned that eastern African countries are fully dependent on imports for fertilizer, for which Ukraine and Russia are also key sources, and that disruption could impact local production and push food prices even further up.