From: slider@anashram.com   
      
   Global food prices are most likely to keep rising even after jumping to a   
   record high in March this year as reflected in the FAO Food Price Index   
   (FFPI) which averaged 159.3 points in March, up 12.6 per cent from   
   February when it had already reached its highest level since its inception   
   in 1990.   
      
   Food accounts for a much larger share of average household's total   
   expenditure in developing countries like Bangladesh where food,   
   non-alcoholic beverages and tobacco weigh very heavily on the consumer   
   price index (CPI), the principal measure of inflation in Bangladesh   
   accounting for 59 per cent of total weight. Furthermore, higher energy   
   prices will also feed into food prices through increased transport and   
   input costs.   
      
   Bank of England Governor Andrew Bailey at a parliamentary hearing last   
   week said a surge in food costs could have "apocalyptic" consequences for   
   the poorest people in society and the global economy. He further added   
   that "That is a major worry not just for this country but for the   
   developing world". Rising food prices are a catastrophe and they have been   
   going up very fast. Some estimates indicate prices may go up between 20-40   
   per cent before they settle down.   
      
   Rising global food prices to record levels are not only contributing to   
   rising inflation but also creating growing levels of food insecurity. The   
   heads of the World Bank group, International Monetary Fund, United   
   Nation's World Food Programme and World Trade Organisation on April 22,   
   2022 released a joint statement calling on the international community for   
   urgent action to address food insecurity, to keep trade open and support   
   vulnerable countries, including by providing financing to meet the most   
   urgent needs.   
      
   The world is, in fact, facing the rising risk a global food crisis. Food   
   crisis is a situation in which food availability drastically worsens   
   within a short period of time. The outlook for global food insecurity in   
   2022 is expected to deteriorate further relative to the previous years.   
   Food price inflation in many developing countries, particularly those with   
   increasingly depreciating currencies with a heavy reliance on food   
   imports  will have  a major impact on the purchasing power of the poorest   
   households. Many of these countries are still experiencing income and job   
   losses due to the pandemic related economic disruptions and their   
   after-effects. The poorest will be the hardest hit and their need to pay   
   for necessities like food means that they will not have any money left to   
   pay  for other necessities of life, some even may experience   
   semi-starvation to starvation.   
      
   According to the World Bank, after decreasing steadily over the previous   
   two decades, poverty rates have been growing worldwide since 2020. It   
   further adds that the pandemic has led to an additional 97 million   
   extremely poor people compared to pre-pandemic projections. Higher food   
   prices, therefore, could drive many to seek food aid. According to the   
   World Food Programme over the last two years the number of severely food   
   insecure people  has doubled and their number now stands at 276 million.   
      
   The increase in food prices led UNCEF on last week to issue an emergency   
   "child alert". It further added that the leading cause of preventable   
   death in children, known as "severe wasting" has increased "by more than   
   40 per cent" since 2016. According to UNICEF/WHO/World Bank statistics,   
   India leads the world in children affected by severe wasting, with over   
   5.7 million children under the age of five suffering from severe   
   malnutrition.   
      
   While economies are slowly starting to recover from  the pandemic induced   
   economic slow down, economic uncertainties continue due to, in many   
   instances, continuing border closures, armed conflicts in the Middle-East   
   and in many parts of Africa and disrupted trade flows. A looming debt   
   crisis among low income countries and an increasingly strong US dollar are   
   also hindering the ability to import sufficient food to meet the domestic   
   demand. To further compound the problem many of these developing countries   
   can not obtain finance on the international financial market to import   
   food.   
      
   Now the breakout of the Russia-Ukraine conflict and the imposition of very   
   heavy US  economic sanctions on Russia are causing sharp price rises in   
   food and energy commodities. In fact, by sanctioning Russia, the US has   
   effectively sanctioned the whole world. The US by imposing ban on Russian   
   export of wheat, fertiliser and the whole range other commodities and at   
   the same time asking the rest of the world that it  can not import these   
   products from Russia is not only disrupting the free flow goods and   
   services but hampering the post pandemic economic recovery, in particular,   
   of developing countries  (more precisely the Global South)  who are facing   
   the brunt of rising food prices. The countries of the Global South are   
   acutely aware that they will be the most vulnerable to the ill effects of   
   US sanctions levelled against Russia and that is  reflected in their lack   
   of support for the US moves against Russia at the UN.   
      
   The food crisis is not relegated to developing countries alone. Soaring   
   costs of living are also being experienced in developed countries due to   
   rise in food prices. Energy prices soared in the European Union in the   
   wake of sanction imposed on Russia pushing inflation to 7.5 per cent in   
   April, the highest rate in the history of the Union. Now there are growing   
   fears of economic hardship for European population. Prices for gas and   
   food are rising while incomes remain stagnant or decline, with much worse   
   trends envisaged for the near term as the sanctions take full effects.   
      
   Real GDP growth in the EU will be 2.7 per cent  this year down from a 4   
   per cent forecast three months ago. Growth is also expected to further   
   slow down to 2.3 per cent next year. Consumer confidence in the UK has   
   plunged in recent times as rising prices of goods from food to other   
   necessities including energy bit into the spending power. Higher prices   
   for food in developed economies could dent consumer spending and,   
   consequently GDP growth.   
      
   Russia and Ukraine are  two of the World's largest agricultural producers   
   and account for nearly 30 per cent of world's wheat exports and 18 per   
   cent of corn. In 2020-21, Russia was the single largest and Ukraine was   
   the 5th largest exporters of wheat in the world.  But the conflict in   
   Ukraine and US sanctions on Russia, in particular, are upending the   
   shipments of cereals, possibly production also.   
      
   During the same year  US was the 4th and Canada the 7th  largest   
   exporters  of wheat but both countries experienced drought last year which   
   led to about 25 percent shortfall in wheat production in these two   
      
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