Food costs dip from near record, offering some inflation respite

Global food prices declined from near a record high at the end of last year, offering some respite to consumers and governments facing a wave of inflationary pressures.

A United Nations index tracking everything from grains to meat fell 0.9 per cent in December, data showed on Thursday. While prices are still near 2011’s all-time high, the halt in the rally could help ease the run-up in prices of grocery store products.

Prices surged since mid-2020 on the back of harvest setbacks and high freight rates, as well as labour shortages and an energy crisis that hit supply chains. The costs have trickled through to supermarkets, piling pressure on officials and household budgets and worsening hunger, particularly in poor nations.

Anger over inflation recently led to violent protests in Kazakhstan, while Sri Lanka unveiled a $1bn package to temper concerns over pricey food and medical items. Countries including Ukraine, Russia and Argentina have also taken steps to keep food costs in check.

The fall in food prices prices last month was mainly driven by vegetable oils and sugar, the UN’s Food and Agriculture Organization said in a report. The overall index’s average in 2021 was up about 28 per cent from a year earlier.