Food price index highest since 2014

The United Nations recently announced that the world food prices increased for the eleventh consecutive month in April 2021. It reached the highest level since May 2014. This announcement was made based on the Food Price Index released by the Food and Agriculture Organisation.

Food Price Index

The Food Price Index measures monthly changes of a basket of food grains such as oil seeds, cereals, dairy products, sugar and meat. In April 2021, the Food Price Index was 120.9. It was 118.9 in March 2021. This basket of grains are subjected to changes and are not constant.

Key findings

• The Food and Agriculture Organisation also announced that the cereal price index increased by 1.2% in April 2021 as compared to March 2021. It increased by 26% as compared to the previous year.
• The maize prices increased by 5.7% due to poor crop conditions in Brazil, Argentina and United States.
• The wheat prices were steady.
• The vegetable oil prices increased by 1.8%.
• Diary Prices increased by 1.2%. The demand for milk products such as milk powder, butter, cheese was mainly from Asia.
• The meat index increased by 1.7%
• Sugar prices increased by 60% as compared to the previous year. This price increase was mainly due to slow harvest in Brazil and also due to large frost damage in France.

Forecasts

In 2021-22, the Food and Agriculture Organisation predicted that wheat production is to increase by 0.5% as compared to that of 2020-21. The forecast is mainly based on the fact that the countries such as China, Brazil, US and Ukraine have increased their planted areas.

Month: Current Affairs - May, 2021