According to a new report released by the United Nations Food and Agriculture Organization, the global food trade should reach an all-time high in both volume and value terms (FAO).
The global food import bill is expected to exceed $1.75 trillion by the end of 2021, representing a 14% increase over 2020 and a 12% increase over the previous forecast.
According to the FAO’s new Food Outlook, food trade demonstrated “remarkable resilience” to disruptions throughout the pandemic, but rapidly rising prices posed significant challenges for poorer countries and consumers.
Higher prices for internationally traded food commodities, as well as a threefold increase in freight costs, are driving the increase.
Developing regions account for 40% of total imports, and their food import bill is expected to increase by 20% over the previous year. Low-income food-deficit countries are expected to grow even faster (LIFDCs).
In terms of products, basic staples such as cereals, animal fats, vegetable oils, and oilseeds are seeing sharp increases in developing regions.
The majority of the increases in developed regions are being driven by high-value foods such as fruits and vegetables, fishery products, and beverages.
World output prospects for major cereals remain positive, with maize and rice harvests expected to be record highs. According to the report, cereals for human consumption and animal feed should grow even faster.
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The forecast anticipates some improvement in the supply situation for oilseeds and derived products, but end-of-season stocks may remain below average.
After three years of decline, global sugar production should recover, but it will still fall short of global consumption.
Overall, trade is expected to fall slightly as a result of reduced supply in key exporting countries and rising prices.
According to the report, meat production should increase as a result of China’s rapid recovery, particularly pig meat. Trade growth is likely to slow, owing to declines in the world’s leading importing regions, primarily Asia and Europe.
Milk production is expected to rise in all major producing regions, with Asia and North America leading the way. Even though import growth has slowed in recent months, global trade should increase.
Households in 53 countries spend more than 60% of their income on necessities such as food, fuel, water, and housing.
The FAO expects output in fisheries and aquaculture to increase by 2%, citing new market dynamics caused by the pandemic as likely to persist. Despite high freight costs and logistical delays, the fish trade is recovering.
FAO experts developed a new tool called the Global Input Price Index to examine the effects of rising input costs on food prices (GIPI).
