Global food costs capped their longest run of monthly declines in at least three decades, bucking soaring supermarket prices that are squeezing households. A United Nations’ index of food-commodity costs fell 0.8 per cent in January, a 10th straight drop and the longest run in data going back to 1990. Prices have slipped 18 per cent from a record in March, when Russia’s invasion of Ukraine disrupted crop flows from the major supplier.
Still, the UN gauge remains historically high and it takes a while for changes to filter though to what people pay at the grocery store. Those shelf prices have soared around the world on the back of high energy, transport and labor costs, adding to the cost-of-living crisis and worsening global hunger. Food giants have warned that retail prices will rise further, particularly as last year’s cost inflation and wage rises feed through.
The UN’s index, which tracks five major staples, declined last month due to lower vegetable oil, dairy and sugar prices, its Food and Agriculture Organization said Friday. It’s at the lowest since September 2021. Wheat prices especially have slid from a high last year as the Black Sea crop-export deal helped cargo flow from Ukraine, while supplies have been boosted by good harvests in major growers like Russia and Australia.
And the dollar, which increased costs for importing nations as it rallied for much of last year, has weakened in recent months. The FAO also said Friday that wheat-planting prospects are mixed for the coming 2023 season, with bigger areas in North America and India partly offset by declines in Russia and Ukraine.