Many Vulnerable Countries Paying More For Less Food, Says New UN Report

The global food import bill is on course to hit a new record of USD 1.8 trillion this year, but higher prices and transport costs rather than volumes account for the bulk of the expected increase, according to a new report released by the Food and Agriculture Organization of the United Nations (FAO).

"Worryingly, many vulnerable countries are paying more but receiving less food," FAO said in its latest Food Outlook published on Thursday. The global food import bill is projected to rise by USD 51 billion from 2021, of which USD 49 billion reflects higher prices.

"These are alarming signs from a food security perspective, indicating that importers will find it difficult to finance rising international costs, potentially heralding an end of their resilience to higher prices," the report notes.

"In view of the soaring input prices, concerns about the weather, and increased market uncertainties stemming from the war in Ukraine, FAO's latest forecasts point to a likely tightening of food markets and food import bills reaching a new record high," said FAO economist Upali Galketi Aratchilage, lead editor of the Food Outlook.

FAO has proposed a Food Import Financing Facility to provide balance-of-payment support to the low-income countries most reliant on food imports as a strategy to safeguard their food security.

Animal fats and vegetable oils are the single biggest contributor to the higher import bills expected to be reached in 2022, although cereals are not far behind for developed countries. Developing countries, as a whole, are reducing imports of cereals, oilseeds and meat, which reflects their incapacity to cover the increase in prices.

Issued twice a year, Food Outlook offers FAO's reviews of market supply and demand trends for the world's major foodstuffs, including cereals, oil crops, sugar, meat and dairy and fish. It also looks at trends in futures markets and shipping costs for food commodities.

According to the report, world production of major cereals is expected to decline in 2022 for the first time in four years, while global utilization is also seen down, for the first time in 20 years. However, the use of cereals for direct food consumption by humans is not anticipated to be impacted, as the decline in total use is expected to result from lower feed use of wheat, coarse grains and rice.

World wheat stocks are set to increase marginally in the year, mostly due to anticipated build-ups of inventories in China, the Russian Federation and Ukraine. Moreover, world maize output and utilization are forecast to hit new records, associated with greater ethanol production in Brazil and the United States of America as well as industrial starch production in China.

The report said global consumption of vegetable oils is predicted to outpace production, despite expected demand rationing.

While meat production is expected to decline in Argentina, the European Union and the United States of America, global output is forecast to expand by 1.4 per cent, led by an 8-per cent foreseen increase in pig meat production in China, reaching and even exceeding the level before the dramatic spread of the African swine fever virus in 2018.

World milk production is forecast to expand more slowly than in previous years, constrained by falling dairy herd numbers and lower profit margins in several major producing regions, while trade may contract from the elevated level of 2021, the report added.

It further said world sugar production is expected to increase after three years of decline, led by gains in India, Thailand and the European Unio

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