Food prices climbed closer to a record high, giving consumers and governments around the world an even bigger inflation headache, Bloomberg reports.
A United Nations gauge of global food prices rose 1.2% last month, threatening to make it more expensive for households to put a meal on the table. It’s more evidence of inflation soaring in the world’s largest economies and may make it even harder for the poorest nations to import food, worsening a hunger crisis.
Prices have jumped for multiple reasons: bad weather hurt harvests, higher shipping rates, worker shortages and an energy crunch hit supply chains, and fertilizer costs have surged too. While it typically takes a while for commodity costs to trickle down to supermarkets, the rally is evoking memories of spikes in 2008 and 2011 that contributed to global food crises.
“This is obviously bad news for consumers,” said Abdolreza Abbassian, a senior economist at the UN’s Food and Agriculture Organization.
November’s push higher was mainly driven by grains and dairy, while prices of vegetable oils and meat declined, the FAO said in a report Thursday.
Higher food prices are pressuring consumer budgets that have already been strained by the COVID-19 crisis and high energy costs. It’s looking likely that shoppers will feel the effects of inflation for months to come as economies re-open in the wake of the pandemic.