World Food Prices Dip by 0.9% in December 2021
The Food and Agriculture Organisation (FAO) food price index has revealed that world food prices fell slightly in December 2021 by 0.9 per cent, noting that the price is still up 23.1 per cent from December 2020.
According to FAO, prices for vegetable oils and sugar fell significantly from lofty levels, as its Vegetable Oil Price Index declined 3.3 per cent in December, with weaker quotations for palm oil and sunflower oil reflecting subdued global import demand that may be linked to concerns over the impact of rising Covid-19 cases.
However, the story was not the same for Nigeria as food prices continue to increase despite the nation’s inflation rate falling for the eighth consecutive month in November to 15.40 per cent from 15.99 per cent recorded in October 2021.
The Nigeria Bureau of Statistics (NBS) office also said the prices of goods and services, measured by the Consumer Price Index, increased by 15.40 per cent (year-on-year) in November 2021.
The FAO Food Price Index averaged 133.7 points in December, 2021, saying that for 2021 as a whole, averaging across the entire year, the Food Price Index averaged 125.7 points, as much as 28.1 percent above the previous year.
The index tracks monthly changes in the international prices of commonly-traded food commodities. Only the dairy sub-index posted a monthly rise in December.
“While normally high prices are expected to give way to increased production, the high cost of inputs, ongoing global pandemic and ever more uncertain climatic conditions leave little room for optimism about a return to more stable market conditions even in 2022, ” said FAO Senior Economist Abdolreza Abbassian.
The FAO Cereal Price Index decreased 0.6 percent from November, as falling wheat export quotations amid improved supplies following southern hemisphere harvests more than offset firmer maize prices underpinned by strong demand and concerns over persistent dryness in Brazil. For the full year, however, the FAO Cereal Price Index reached its highest annual level since 2012 and averaged 27.2 percent higher than in 2020, with maize up 44.1 percent, wheat up 31.3 percent, but rice down by 4.0 percent.
For 2021 as a whole, the FAO Vegetable Oil Price Index reached an all-time high, increasing 65.8 percent from 2020.
The FAO Sugar Price Index decreased by 3.1 percent from November, reaching a five-month low, reflecting concerns over the possible impact of the Omicron COVID-19 variant on global demand as well as a weaker Brazilian Real and lower ethanol prices. For 2021 as a whole, the FAO Sugar Price Index rose 29.8 percent from the previous year to its highest level since 2016.