SOARING FOOD PRICES HIT POOR HARD

In January, world food prices rose to levels not seen since 2011, according to a 3 February report by the United Nations Food and Agriculture Organization (FAO).
Food prices shot up 6.85 percent in December, year over year, the International Monetary Fund said, the highest since the agency began tracking the rate in 2014.
From April 2020 through last December, corn and wheat prices leaped up 80 percent, soybean prices zoomed 52 percent, and frost and droughts in Brazil sent coffee prices up 70 percent.
Prices climbed across the range of staples, including cereals, coffee, dairy, grains, meats, and pasta.
Prices of food-related oils touched heights not seen since the FAO began recording them in 1990.
Prices have been pushed up by labor and fertilizer shortages, severe weather that has damaged crops, and supply-line disruptions that have complicated sending products to market, The New York Times reported.
In parts of Africa and Latin America, households may be spending half or more of their incomes on food, Maurice Obstfeld, a senior fellow at the Peterson Institute for International Economics, noted.
Asia has largely been spared because of a bountiful rice crop, while areas of the world more dependent on food imports are in danger, the FAO said.
As many as 106 million Africans now face food insecurity, an estimate by the National Defense University found, twice as many as in 2018.
Argentina, Brazil, Russia, and Turkey are paying more for food because the dollar, which is used as the trading currency for food, has risen in value against those currencies.
In the U.S., families spend only about one-seventh of their incomes on food, so much of the population is not facing hunger.
However, even there, food prices gained 6.3 percent in the 12 months ending last December, with the cost of eggs, dairy, fish, and meat jumping 12.5 percent, the U.S. Bureau of Labor Statistics reported.
It is not “much of an exaggeration” to say that the world is approaching a dramatic food crisis, with governments’ overstretched budgets, high unemployment in some nations, and slow economic growth creating “a perfect storm of adverse circumstances,” he said.
“There’s a lot of cause for worry about social unrest on a widespread scale,” he warned.
Food prices were trending upward even before the COVID War: disease wiped out much of China’s pig herd and China cast tariffs over U.S. farm goods during the two countries’ trade war.
Harsh weather in Argentina, Brazil, Russia, Ukraine, and the U.S. also has taken greater tolls on production.
TREND FORECAST: As we noted in “LATIN AMERICA MIGRANT WAVE COMING” in this issue, food shortages are often the match that ignites social and political revolts.
As hunger increases in poor countries, so will public anger, street protests, and governments’ instability. Exploiting public anger, power hungry politicians will attempt to seize power and pick at the resentments that divide class from class and group from group.