RIYADH: Food import costs globally are projected to reach an all-time high of nearly $2 trillion this year, the UN Food and Agriculture Organization (FAO) said in a report.
This is higher than previously expected as the new forecast of $1.94 trillion would represent a 10 percent increase over the record level of 2021.
However, the pace of increase is expected to slow down in response to higher food prices and the depreciation of currencies against the US dollar, according to the latest Food Outlook report.
Although prices have slightly dropped, the Russian-Ukrainian war continues to take a toll on the world’s food supply, as both countries accounted for 30 percent of all wheat exports, and other staple foods in the past.
Developing countries will make up for most of the global food import bill; however, poorer nations will still be highly affected, as their import volume is expected to shrink by 10 percent closing at the same bill because of inflationary pressures and accessibility issues, it added.
In addition, the report mentions that poorer economies will be forced to divert their imports to staple foods in comparison to their richer counterparts, who will continue to benefit from an entire range of food products.
The International Monetary Fund has intervened to curb the blow of soaring prices, where it approved a new shock window to compensate lower-income countries for the rise in prices.
FAO said it supported this decision deeming it essential to reduce the burden of import costs on poorer economies.
The report also drew attention to spending on imported agricultural inputs, where projections show a 50 percent surge to $424 billion of the global bill, fueled by increased costs of imported energy and fertilizers.
The Food Outlook report, which is published twice a year by the agency’s Markets and Trade Division, warns that existing differences are likely to become more pronounced.
“These are alarming signs from a food security perspective, indicating importers are finding it difficult to finance rising international costs, potentially heralding an end of their resilience to higher international prices,” noted FAO.
“Negative repercussions for global agricultural output and food security” are likely to extend into 2023, it added.