For millions of families in developing nations, the past year has been a struggle to put food on the table. In regions of Africa, the Middle East, and Asia that were already facing a food crisis, the cost of staples like bread and cooking oil surged, forcing households to cut back on meals or switch to cheaper, less nutritious options. The human toll of these rising prices is now measured in a stark new statistic: global food commodity prices reached their highest levels ever recorded in 2022, according to the U.N. Food and Agriculture Organization (FAO).
A Year of Record-Breaking Prices
The FAO, based in Rome, tracks the monthly changes in prices of frequently traded food commodities on the worldwide market. For the entire year of 2022, its Food Price Index averaged 143.7 points. This was more than 14% higher than the 2021 average, which itself had experienced significant rises. The index reached its highest point since records have been kept beginning in 1961, surpassing the previous peak set in 2011.
The record was driven by a confluence of factors. Russia’s invasion of Ukraine in February exacerbated a food catastrophe, as both nations are among the world’s top producers of wheat, barley, sunflower oil, and other goods. The disruption of crucial Black Sea supplies sent food prices to record highs, increasing inflation, poverty, and food insecurity in the developing countries that depend on imports. A drought and other factors further increased inflation and exacerbated hunger around the world.
Signs of Relief in Late 2022
There were some signs of easing by the end of the year. The FAO reported that global food commodity prices declined for nine straight months as a result of the Russian military campaign in Ukraine, drought, and other factors. Prices fell 1.9% in December from a month earlier. The December decline was driven by a drop in vegetable oil prices, which fell with declining import demand, forecasts of higher soy oil production in South America, and decreased crude oil prices. Grain and meat prices also declined, while dairy and sugar saw a tiny increase.
The FAO’s Vegetable Oil Price Index, which had reached a record high in 2017, declined in December to its lowest point since February 2021. The Meat Price Index and Dairy Price Index both reached their highest levels since 1990 for the entire year of 2022. The organization also noted that harvests in the Southern Hemisphere increased supplies for other grains, and that exporters faced fierce competition.
Caution and the Road Ahead
While the lower food commodity prices are welcome after two years of extreme volatility, the FAO’s chief economist, Maximo Torero, urged caution. “Given that world food prices continue to be high, that many staples are close to record highs, that rice prices are rising, and that there are still numerous concerns related with future supplies, it is necessary to be attentive and have a strong focus on alleviating global food poverty,” Torero said.
Looking forward, the key question for 2023 is whether the downward trend in prices will hold. The decline in vegetable oil and grain prices offers some hope for consumers, but the war in Ukraine continues to cast a shadow over global grain supplies. Rising rice prices, a staple for billions, represent a new and worrying front. The energy market remains a wild card, affecting everything from fertilizer costs to transportation. For the families in developing nations who have borne the brunt of this crisis, the relief has been partial and fragile, and the need for sustained attention to global food security remains acute.
