Food prices

The UN’s Food and Agriculture Organisation’s findings show that poor countries continue to suffer the impact of high food prices. The blow was now compounded by sharply lower economic growth and remittances, said food aid officials.

“The food crisis has not gone away. In fact, it is coming back,” said Christopher Delgado, a policy adviser in agriculture at the World Bank, at a recent conference, who justified its warning on high local prices.

Food aid officials attribute the disconnect between local and international food prices to time lags, poor harvests in developing countries and in some cases to the difficulties of importing agricultural commodities due to the lack of trade finance.

The FAO will unveil on Thursday a tool to monitor about 800 monthly domestic retail and wholesale prices of main foods consumed in 55 developing countries. Until now, information on local prices was patchy.

Food price inflation hits the poor hardest, as the share of food in their total expenditure is much higher than that of wealthier populations, according to the FAO. Food represents about 10-20 per cent of consumer spending in industrialised nations, but as much as 60-80 per cent in developing countries, many of which are net-food-importers.

Although the price of corn, wheat, rice and other food staples in international markets has tumbled between 60 and 40 per cent from the all-time highs of last year, local food prices in most sub-Saharan African countries are today higher than a year ago, the FAO data show.

Retail rice in Malawi was quoted at 210 kwacha ($1.50, €1.11, £1.05) a kilogram, almost double that of a year ago. In Zambia, white maize, the main staple, cost in local markets 28,185 kwacha ($4.97, €3.69, £3.48) per 20kg, up from 17,500 kwacha a year ago.

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