Inflation watch: Global food prices hit 10-year high

Food prices around the world continue to climb, hitting a fresh decade high last month, according to the latest report by the United Nations Food and Agriculture Organization.

The FAO Food Price Index climbed for a third straight month in October, jumping 3 percent from the previous month to reach its highest level since July 2011.

Higher food prices are felt by everyone, but are especially hard on poorer households that need to shell out a larger share of their income to keep themselves and their families fed.

Global prices for food, energy and other commodities have soared this year as countries roll back COVID-19 restrictions, triggering supply shortages and bottlenecks.

Reduced harvests for some items and a recent surge in energy prices is also feeding food price inflation.

October’s gains in the FAO Food Price Index were led by vegetable oils, with prices increasing 9.6 percent in October from the previous month – a new all-time high.

Cereal prices also rose sharply, gaining 3.2 percent from the previous month and a massive 22.4 percent from a year ago.

Within the cereals category, wheat prices rose for a fourth straight month to reach their highest level since November 2012. Prices of maize and rice also edged up in October.

The global supply crunch helped drive dairy prices higher for the second month straight, thanks to “buyers’ efforts to secure supplies to build stocks”, said the FAO.

Bucking the march higher were meat prices, which eased for the third consecutive month, led by falling pork prices, thanks to reduced purchases from China, and falling beef prices triggered by mad cow disease concerns surrounding Brazilian supplies.

Prices of sugar also fell 1.8 percent in October from the month before – the first decline after six straight months of price gains.