# World food prices hit record high in 2022
Author:  Pal Sinha, Barnali 
Author URL: https://financedigest.com/author/pal-sinha-barnali
Published: 2023-01-06
Category: NEWS
Category URL: https://financedigest.com/category/news
Meta Title: FAO Reports Highest Food Price Index on Record Due to
Meta Description: Discover how Russia's invasion of Ukraine and other factors led to a surge in global food prices, impacting the FAO's food price index.
URL: https://financedigest.com/world-food-prices-hit-record-high-in-2022html

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By Sybille de La Hamaide

PARIS (Reuters) -A surge in the cost of most food commodities last year, as the disruption caused by Russia’s invasion of Ukraine raised concerns of shortages, sent the U.N. food agency’s average [price index to the highest level on record](https://www.financedigest.com/tesla-posts-record-quarterly-deliveries-after-price-cuts-up-4-from-q4.html "Tesla posts record quarterly deliveries after price cuts, up 4% from Q4").

The Food and Agriculture Organization’s (FAO) food price index, which tracks international prices of the most globally [traded food commodities](https://www.financedigest.com/a-brits-guide-to-understanding-commodity-trading.html "A Brit’s Guide to Understanding Commodity Trading"), averaged 143.7 points in 2022, up 14.3% from 2021, and the highest since records started in 1990, the agency said on Friday.

The index had already gained 28% in 2021 from the previous year as the [world economy](https://www.financedigest.com/at-chinas-largest-trade-fair-exporters-worry-about-world-economy.html "At China’s largest trade fair, exporters worry about world economy") recovered from the impact of the pandemic.

Food [prices surged](https://www.financedigest.com/explainer-oil-price-surge-changes-ecb-narrative-only-at-the-margins.html "Explainer-Oil price surge changes ECB narrative only at the margins") after Russia’s invasion of Ukraine in February last year on fears of disruptions to Black Sea trade. They have pared some of their [gains since](https://www.financedigest.com/dollar-heads-for-first-weekly-gain-since-february.html "Dollar heads for first weekly gain since February"), in part because of a U.N.-backed [grain export channel from Ukraine](https://www.financedigest.com/traders-cut-ukraine-2022-combined-grain-and-oilseeds-crop-forecast.html "Traders cut Ukraine 2022 combined grain and oilseeds crop forecast") and the prospect of improved supplies in producing countries.

In [December the benchmark index fell for the ninth consecutive month](https://www.financedigest.com/spains-12-month-inflation-slows-down-again-in-december-to-5-8.html "Spain’s 12-month inflation slows down again in December to 5.8%") to 132.4 points, compared with a revised 135.00 points for November. The November figure was previously given as 135.7 points.

Calmer food commodity prices are welcome after two very [volatile years,”](https://www.financedigest.com/crop-merchant-louis-dreyfus-gets-profit-boost-in-volatile-year.html "Crop merchant Louis Dreyfus gets profit boost in volatile year") FAO Chief Economist Maximo Torero said.

The decline in the index in December was driven by a drop in the international [price of vegetable oils](https://www.financedigest.com/oil-prices-steady-as-news-of-saudi-russia-meeting-calms-investors.html "Oil prices steady as news of Saudi, Russia meeting calms investors"), together with some declines in cereal and meat prices, but mitigated by slight increases in those of sugar and dairy, the FAO said.

Still over the whole of 2022, four of the FAO’s five food sub-indexes – cereals, meat, dairy and vegetable [oils – had reached record](https://www.financedigest.com/u-s-oil-exports-to-europe-hit-record-in-march-on-steep-discounts.html "U.S. oil exports to Europe hit record in March on steep discounts") highs, while the fifth one, sugar, was at a 10-year high.

The FAO Cereal [Price Index index rose 17.9% in 2022 due to factors including significant market](https://www.financedigest.com/german-residential-property-market-faces-risk-of-price-drop-diw-study.html "German residential property market faces risk of price drop – DIW study") disruptions, higher energy and input costs, adverse weather and continued strong global food demand, the FAO said.

(Reporting by Sybille de La Hamaide; editing by Barbara Lewis)


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