BM: Commodity prices will remain at high levels until the end of 2024

The World Bank (WB), has asserted food prices will remain at high levels until the end of 2024.

In a new report on food security, the WB notes that “the war in Ukraine is changing the pattern of commodity trade, production and consumption, which is expected to keep prices high until the end of 2024, thus aggravating food insecurity and inflation”.

According to the report, “since the beginning of the war in Ukraine there has been a wave of measures on the export and import of foodstuffs”, and the world food crisis “has been partly aggravated by the intensification of trade restrictions imposed place by countries with the aim of increasing domestic supply and lowering prices”.

“As of October 10, 2022, 21 countries had imposed 26 export bans on certain agricultural products and eight countries had adopted 12 measures restricting exports”, specifies the World Bank, stressing that after a brief respite during the In the summer of 2022, fertilizer prices started to rise again.

The WB also notes that “in addition to the increase in energy prices, export restriction measures have contributed to limiting the world supply of fertilizers”, specifying that inflation of domestic food prices remains high at worldwide.

Data available between May and September 2022, it adds, shows high inflation in almost all low- and middle-income countries: 88.9% of low-income economies, 91.1% of lower-middle-income economies and 96% of upper-middle-income economies recorded inflation rates above 5%.

The share of high-income countries hit by rising inflation in food now stands at 85.7%, notes the financial institution, which maintains that the price index for agricultural products has increased by one point percent from the level seen two weeks ago. Wheat, maize and rice prices in October 2022 are 18%, 27% and 10% higher, respectively, than in October 2021.

Compared to the prices recorded in January 2021, the prices of wheat and maize show an increase of 38% and 4% respectively, and those of rice a decrease of 21%. “Soaring food prices are causing a global crisis that is driving several million more people into extreme poverty and worsening hunger and malnutrition,” warns the World Bank, adding that food price hikes food and energy caused by climatic shocks and conflicts have stalled the recovery.

According to a recent IMF study, between $5 billion and $7 billion in additional spending will be needed to help vulnerable households in the 48 countries hardest hit by rising food and fertilizer import prices. And $50 billion will be needed to end acute food insecurity over the next 12 months. The number of acutely food insecure people who will need urgent assistance could climb to 222 million in 53 countries and territories, according to an FAO-IMF report.

To address the current food security crisis, the World Bank Group is deploying a large-scale response that includes $30 billion over 15 months for financing in areas such as agriculture, nutrition, social protection, water and irrigation.

This financing aims to encourage food and fertilizer production, improve food systems, facilitate trade and support vulnerable households and producers.

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