Global food prices continue to rise – World Bank
The World Bank reports that there is still significant global food price inflation.
In its most recent Food Security Update report, released on Tuesday, the World Bank said high inflation was observed in low, middle, and high-income countries based on the data available on food prices.
It said, with a 1.3 percentage point increase from the previous food update on January 17, 2023, that the rate of inflation was more than five percent in 63.2 percent of low-income countries.
The report indicated that 73.9 per cent of lower-middle-income countries and 48 percent of upper-middle-income countries, with no percentage change from the previous update, had inflation rates higher than five percent.
Also, two groups, Consumers International and Consumer Advocacy and Empowerment Foundation (CADEF), on Tuesday urged the federal government to step in to halt what they described as unfair food pricing in the market.
They urged the federal government to address the threat of unfair food prices, including strengthening competition, sanctioning anti-competitive practices, tackling monopolies, addressing multiple taxations, and supporting subsidies for farmers.
The group’s research indicated a continued acceleration of retail prices compared to wholesale prices, particularly for beans, yam, rice, chicken, and maize, thus necessitating the call for a thorough investigation by the Federal Government.
Executive Director at CADEF, Prof. Chiso Okafor, stressed the need for regulatory intervention to ensure fair pricing in food markets. Okafor said: “The findings underscore the urgent need for authorities to investigate and address any unfair practices that may be contributing to the burden on consumers and farmers.”
They said the recent research they conducted showed very disturbing trends in Nigeria’s food pricing landscape. The research spans six geo-political zones and focused on fluctuations in food prices, especially staple items such as yam, garri, rice, beans, chicken, and groundnut oil between the months of November and December last year.
The groups’ earlier research in August showed a substantial rise in retail/consumer prices compared to wholesale/market prices for essential food items which suggested that consumers are disproportionately burdened with increased costs, raising questions about fairness in the market.
Consumers International, representing consumers worldwide, developed a tool called the Fair Food Price Monitor. This tool tracks the relationship between food prices at different supply chain stages, utilizing data from reputable sources such as the National Bureau of Statistics (NBS) and FEWS NET.
Specialist in Fair Food Prices in Africa at Consumers International, Davine Minayo, stressed the importance of data-driven decision-making to address market imbalances.
Minayo said: “Our collaborative efforts aim to shed light on the issues affecting consumers and farmers in Nigeria.”
According to the groups, detailed analysis of farm gate, wholesale, and retail prices for commodities such as maize, rice, beans, yam, palm oil, and chicken over the past three weeks revealed notable price fluctuations.
“November and December brought forth noteworthy shifts in the percentage changes across the value chain for key commodities—beans, chicken, maize, and yam. These fluctuations serve as a lens through which we can examine the intricate interplay of market forces, presenting opportunities and challenges alike.
“At the farmgate level compared to the retail level, in November, beans, chicken, and maize took the spotlight with substantial percentage changes of 127.29per cent, 176.16per cent, and 134.07 per cent, respectively. The stage altered in December, witnessing a recalibration of these figures. Beans retained prominence, albeit with a reduced percentage change of 97.84per cent, while chicken and maize experienced shifts to 41.10 per cent and 111.45 per cent, respectively. Intriguingly, yam emerged as a contender in December, securing a notable percentage change of 87.34per cent,” they said, adding that understanding the factors driving these fluctuations is crucial for market analysis and decision-making.
“These fluctuations underscore the volatility within the retail sector, where even slight changes can have palpable impacts on consumer accessibility and affordability. Stakeholders are advised to closely monitor these trends, engage in ongoing analysis, and remain adaptable to the evolving dynamics of the commodity market. The overarching concerns emanate from price variations at each level of the value chain. The potential impacts on farmers’ income, supply chain stability, and consumer affordability necessitate collective attention, the groups said.
According to them, in response to the identified challenges, stakeholders are encouraged to commit to a call to action. Collaborate with farmers and distributors (market associations, farmers associations, security agencies, etc.,) to address farmgate and retail concerns. Enhance market transparency and information sharing for pricing stability. Engage in discussions to address systemic issues within the food supply chain. This nuanced analysis serves as a call to action for all stakeholders to navigate the complexities of the food supply chain collectively.
According to the World Bank, in high-income nations, food inflation was also above five percent in 44.4 percent of the countries, a decrease of 1.9 percentage points from the previous food update.
Based on the report, in seventy-one percent of the 165 countries where data was available, the inflation of food prices exceeded the inflation of overall prices in real terms.
“According to the International Food Policy Research Institute (IFPRI), the recent attacks by Houthi rebels on ships in the Red Sea have triggered a 40 percent decrease in trade volumes in the Suez Canal, which is decreasing global food security,”
The report highlighted the critical issue of food insecurity within the framework of multiple challenges, according to the World Bank’s Global Economics Prospects 2024 report.
“In 2023, food prices, a significant component of the agricultural price index, declined by nine percent because supplies of major crops were ample, except for rice, which declined by 27 percent.
“Food prices are expected to decline further in 2024 and 2025, although potential risks such as energy cost increases, adverse weather events, trade restrictions, and geopolitical uncertainty could affect them.”
Citing a blog post from the World Bank Agriculture and Food Global Practice, the report said the pressing need for circular food systems to solve environmental issues was being addressed.
“Circular food systems, which emphasise reduce-reuse-recycle-remove approaches, are proposed as a way to build profitable, sustainable, low-emission food systems.”
The World Bank Group announced that it has stepped up its response to food and nutrition security in response to the global food security crisis.
It declared it is now making $45 billion available through a combination of $22 billion in new lending and $23 billion from its existing portfolio.
“Our food and nutrition security portfolio now spans across 90 countries.
“It includes both short-term interventions such as expanding social protection, also longer-term resilience such as boosting productivity and climate-smart agriculture.
“Our intervention is expected to benefit 335 million people, equivalent to 44 percent of the number of undernourished people.
“Around 53 percent of the beneficiaries are women who are disproportionately more affected by the crisis.
“Some examples include the 766 million dollars West Africa Food Systems Resilience Programme, aimed to increase preparedness against food insecurity and improve the resilience of food systems in West Africa.”
The World Bank noted plans were underway to commit an additional 345 million dollars to Togo, Senegal, and Sierra Leone.
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