Global food crisis may persist, with prices still elevated after a year of war – IMF

The global food crisis may persist, with prices still rising after a year of war – IMF

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Thursday 09 March 2023 20:15

A publication by the International Monetary Fund (IMF) Blog said that a year after Russia’s invasion of Ukraine disrupted agricultural commodity markets, food prices remained elevated even after retreating from record highs in early 2022.

With two major exporters of wheat and other important crops in their second year of war, many vulnerable countries are still experiencing food insecurity. Fragile and conflict-affected countries, home to 1 billion people, are at particular risk.

Eleven consecutive monthly declines have left food prices down 19 percent from their peak last March, the Food and Agriculture Organization of the United Nations said on Friday.

As the Chart of the Week shows, inflation-adjusted prices in February remained higher than the average level for recent years, although they have now returned to the levels seen before the war in Ukraine. The composition of the FAO Food Price Index shows that vegetable oil led to a drop in prices, as well as milk and cereals, while sugar and meat were unchanged from the beginning of last year.

The IMF and other global institutions said in a new joint statement on food security that governments and donors should increase support for the most vulnerable, facilitate trade and markets, and abandon harmful subsidies.

“More action in these three key areas is needed to prevent a prolonged crisis,” the heads of the FAO, the IMF, the World Bank, the World Food Program and the World Trade Organization said in a statement on February 8, the third since July on the food security and nutrition crisis global.

The IMF’s new Food Shock Window has so far supported Guinea, Haiti, Malawi, and Ukraine. In addition, nine countries facing acute food insecurity benefit from IMF financial support through new or existing programs, with a focus on strengthening social networks and policies to help address the impact of the food crisis.

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