UN says worldwide food import bill to reach record high in volume and value in 2021

The United Nations Food and Agriculture Organization (FAO), revealed that worldwide food commerce will reach record levels of all-time-high in terms of volume and value. As per new research issued on Thursday by FAO, the world food import bill is expected to exceed $1.75 trillion by the end of 2021, representing a 14% rise over 2020 and an increase of 12% over the prior prediction.  

The FAO's new Food Outlook report noted that the food commerce has demonstrated "remarkable resilience" to interruptions during the COVID-19 outbreak, however, the drastic rise in prices of the food commodities have posed substantial concerns for poorer nations and consumers, as per a UN report. Rising prices of globally traded food items and a triple spike in transportation expenses are driving the surge in food products. 

'Developing countries contribute for 40% of total global food trade'

As per the report, developing countries contribute for 40% of the total global food trade, and their food import bill is predicted to increase by 20% over the previous year, while in the case of Low-Income Food Deficit Countries (LIFDCs), it is predicted to have a rise even quicker. In developing countries, the price of basic commodities in terms of items like grains, animal fats, vegetable oils, and oilseeds is skyrocketing. Further, high-value foodstuffs, including fruits and vegetables, fisheries items, and drinks, are fueling the majority of the rises in developed parts of the world. 

The report predicts an increase in the worldwide food supply  

The Outlook report further anticipates that there should be a development in the supply condition for oilseeds and derived products, yet, the improvements in the end-season good may continue to stay below average. After three years of decline, global sugar production is expected to recover, but it will still fall short for global consumption, according to the report.  

The report predicts that meat output would increase as a result of China's rapid recovery, particularly pig meat. Due to reductions in main importing areas, primarily Asia and Europe, the trade was slowed down. Furthermore, the production in the milk sector is expected to rise in all top producing areas, with Asia and North America leading the way. Although with the recent reduction in the rate of import growth, international trade should increase. 

Furthermore, production from fisheries and aquaculture production is predicted to rise by 2%. According to Food and Agriculture Organization, the pandemic which has largely altered market dynamics is likely to persist. Fish trade is bouncing back despite rising freight prices and logistical difficulties. 

Meanwhile, FAO specialists developed a new instrument called the Global Input Price Index (GIPI) to analyse the effects of increased input expenses on food prices.  As per the report, since 2005, the current GIPI has moved in the same manner as the Food Price Index (FFPI), implying that rising input expenses lead to higher food prices. The FFPI has jumped by 34% this year till August, while the GIPI rose by 25%. 

(Image: AP)