Global prices for agricultural products have surged to a 14-year high
In August, global prices for major agricultural commodities posted their fastest monthly increase in more than 14 years. The agricultural price index jumped by more than 13% over the month.
Among the main reasons cited for this surge are supply disruptions caused by wars, as well as extreme weather events.
The Bloomberg Agriculture Spot Index, which tracks the prices of ten major agricultural commodities, rose by more than 13% over the month as of August 28. This is the largest monthly increase for the index since July 2012. One of the key factors driving the price increase was wheat, whose prices reached a three-year high.
The market has been affected by attacks on Black Sea ports, which are leading to a reduction in shipments from one of the world’s key regions for grain production and export. Prices for sugar and cocoa have also risen significantly—by approximately 20% over the past month.
Weather risks, particularly the intensification of the El Niño phenomenon, are creating additional pressure on agricultural markets.
At the same time, rising costs of agricultural raw materials will not necessarily lead immediately to a corresponding increase in retail prices. However, this is occurring against a backdrop of high energy and transportation costs, which increases the risk of rising food prices.
In particular, rising raw material costs could affect prices for bread, meat, and dairy products in many countries around the world.
This was reported by Bloomberg.
Vegetable prices fluctuated sharply at the end of August.
In Ukraine, prices for vegetables used in borscht continue to fall thanks to the arrival of the new harvest. No shortages of major vegetables are expected in late August and September.
