World Bank Says Food Prices Are Stable Across the Globe
The World Bank has said that the agricultural and cereal price indices globally has remained stable over the past two weeks and are currently 1 point higher. ‘The export price index is 1 point lower.’
Cereal prices it stated were relatively stable; wheat prices increased by 3 percent and maize prices by 4 percent, while rice prices, which have remained relatively stable, fell by 0.2 percent.
Average wheat, maize, and rice prices in October 2022 are 18 percent, 27 percent, and 10 percent higher, respectively, than in October 2021, whereas wheat and maize prices are 38 percent and 4 percent higher, respectively, and rice prices 21 percent lower than in January 2021.
“Food Price Inflation Dashboard Domestic food price inflation (measured as year-on-year change in the food component of a country’s Consumer Price Index (CPI)) remains high.
Information from the latest month between June and September 2022 for which food price inflation data are available shows high inflation in almost all low- and middle-income countries; 88.9 percent of low-income countries, 91.1 percent of lower-middle-income countries, and 96 percent of upper-middle-income countries have seen inflation levels above 5 percent, with many experiencing double-digit inflation.”
“The share of high-income countries with high inflation is also high, with about 85.7 percent experiencing high food price inflation. The countries affected most are in Africa, North America, Latin America, South Asia, Europe, and Central Asia.”
In real terms, food price inflation exceeded overall inflation (measured as year-on-year change in the overall CPI) in 83.1 percent of the 166 countries for which food CPI and overall CPI indexes are both available This week there are 10 countries with the highest food price inflation, in nominal and real terms.
According to the bank, despite decreasing International food prices, October Agricultural Market Information System Market Monitor Highlights Persistent Domestic Food Price Inflation According to the most recent Agricultural Market Information System (AMIS) Market Monitor, released in October 2022, high energy and fertilizer costs, poor weather in key producing countries, and risks from the war in Ukraine have led to high domestic food price inflation, with most countries experiencing year-on-year increases of between 10 percent and 30 percent.
Despite decreases in international food prices to war levels before the war, prices remain high and are subject to continued upward pressure. In September 2022, the International Grains Council Grains and Oilseeds Index fell 1.0 percent from August.
Despite increasing fears of recession, world export prices for wheat increased by 2.4 percent in September, which may be linked to uncertainty surrounding Ukraine’s newly resumed exports.
The International Grains Council maize sub-index indicated a slight increase in international prices of 0.2 percent in September, with the average climbing to a 3-month peak, which downgraded Midwest production prospects may have caused.
The average international price of rice increased by 3.1 percent month over month in September 2022, reacting to the 20 percent export duty on rice and the ban on broken rice exports from India. Lastly, international soybean prices decreased by 3.1 percent in September month on month, the lowest they have been in 8 months.
The Market Monitor highlights geopolitical risk as a major driver of price volatility. Geopolitical risks differ from traditional shocks (e.g., adverse weather events, high energy and transportation costs, government policies) in how they affect international markets. Geopolitical drivers such as the war in Ukraine can disrupt markets and upset international trade.
