{"id":543183,"date":"2022-01-13T13:59:24","date_gmt":"2022-01-13T13:59:24","guid":{"rendered":"https:\/\/enterpriseam.com\/egypt\/2022\/01\/13\/how-supply-shortages-and-climate-change-will-affect-food-security-this-year\/"},"modified":"2022-01-13T13:59:24","modified_gmt":"2022-01-13T13:59:24","slug":"how-supply-shortages-and-climate-change-will-affect-food-security-this-year","status":"publish","type":"post","link":"https:\/\/enterpriseam.com\/egypt\/2022\/01\/13\/how-supply-shortages-and-climate-change-will-affect-food-security-this-year\/","title":{"rendered":"How supply shortages and climate change will affect food security this year"},"content":{"rendered":"

<\/a> Your breakfast got more expensive in 2021. Expect it to continue in 2022: <\/strong>Extreme weather, changing consumption habits and logistical issues have converged to raise food prices 28% y-o-y in FY2021 to their highest level in a decade, according to the FAO Food Price Index (FFPI).<\/strong> And the FAO<\/a> does not expect the trend to reverse any time soon. In fact, oats and coffee futures were the fastest growing commodities in 2021, rising faster than oil and natural gas \u2014 this in spite of the two crops being grown in completely different climates. Climate experts have warned<\/a> that the continuing trend could potentially lead to trade restrictions and stockpiling.<\/p>\n

Breakfast is getting pricier. <\/strong>The Financial Times<\/a>\u2019 breakfast indicator, which combines futures prices of coffee, milk, sugar, wheat, oats and orange juice, rose by 63% since 2019. Wheat futures rose 20% during the first three quarters of 2021 as drought hit Russia, North America and Argentina, while oat prices doubled after a severe drought in Canada \u2014 which drives global trade \u2014 hit the crop, shrinking the country\u2019s oat production by 44%. Droughts that began in the western US in 2020 also affected this year\u2019s yield, leading to farmers planting and harvesting less this year, Chad Hart, economics and crop markets specialist told Quartz<\/a>.<\/p>\n

As the biggest importer of wheat, we\u2019ve felt the crunch at home. <\/strong>Wheat traded at its highest level in more than a decade last year<\/a>, and Egyptian tenders delivered the highest prices in at least five years. We were forced to diversify<\/a> our wheat purchases in the face of steep import bills last month as the price of the grain rose. The rising price of wheat, which is the source of one-third of our calories and 45% of our protein, has the government preparing to reduce bread subsidies<\/a> to soften the impact on the state budget.<\/p>\n

And java is on the rise. <\/strong>In December, the price of coffee spiked<\/a> 56% to a 10-year high, with forecasts that the tightness could last well into 2023 as coffee futures soared to USD 2.46 per lb. The uptick came due to turbulent weather conditions, geopolitical conflict and rising covid cases in the three major coffee producing countries, Brazil, Ethiopia and Vietnam, respectively. Droughts followed by severe, unseasonal frost in Brazil\u2019s coffee growing regions resulted in a 40% decline in arabica harvests, while wet conditions affected yields in Colombia. In Brazil, turbulent weather damaged trees, which will likely affect next season\u2019s harvest as well. Coffee has been hit especially hard by the shortage of container ships as well, which has driven prices up even further.<\/p>\n

You might want to take your tea mazboot, not ziyada. <\/strong>Sugar prices spiked to their highest point in a decade in October due to bad weather, supply chain crunches and changing consumption habits. Sugar prices saw an almost 25% hike<\/a> at home during the first week of January to hit EGP 10.50 per kilo instead of EGP 8.50 due to the rising price of raw sugar internationally, which rose 37.5% from 2020, according to the FAO Sugar Price Index.<\/p>\n

Real meat and (unreal) meat are also being affected. <\/strong>The FAO Meat Price Index probably saw the smallest increase, at under 13% from 2020, with the sharpest increase in prices coming in the ovine (lamb) category \u2014 a trend that is likely to continue given the spike in oat prices, which are used primarily for animal feed. Plant-based meat saw a spike in prices as well after a heatwave in Canada more than doubled the price of yellow peas from Saskatchewan \u2014 an ingredient used by manufacturers of plant-based meat alternatives. Additionally, the FAO Vegetable Oil Price Index rose 65.8% from 2020, with biofuel demand also driving an increase in the price of vegetable oils.<\/p>\n

The rising cost of fertilizer isn\u2019t helping. <\/strong>Fertilizer prices sharply increased<\/a> in 3Q2021 and continued to rise to levels last seen during the 2008-09 global financial crisis, resulting in rising inflationary pressure. Major producers like China and Russia have suspended fertilizer exports until mid-2022 as they look to address their own food security challenges.<\/p>\n

Poor weather will likely continue into 2022. <\/strong>There is no clear end in sight, as forecasters predict<\/a> that 2022 will see severe storms and flash flooding as the weather phenomenon La Ni\u00f1a returns to the Pacific Ocean. La Ni\u00f1a events typically cause drought in the southern US and heavy rainfall and flash flooding in the Pacific Northwest and Canada. Bad harvests from last year will affect investment in this year\u2019s harvest and likely affect inventories for more than a year to come. Senior economist at the FAO warns of a potential \u201ccontagious effect,\u201d where the price of substitute crops rises in response to soaring prices of essential crops.<\/p>\n

Panic buying and just in case buying are also contributing to price increases as uncertainty looms ahead. <\/strong>With food companies raising their prices to protect profit margins, an agricultural commodities market researcher at Rabobank told the Financial Times that high prices are likely to continue for another year at least due to heightened costs for production, processing and transport \u2014 a culmination of labor shortages and supply chain disruptions.<\/p>\n

What does this mean for Egypt? <\/strong>Disruption to global flows could threaten our food security because of reliance on imports of food staples, according to a report issued by FAO last year, which found that 45.4% of Egyptians cannot afford a nutrient-adequate diet and 84.8% can\u2019t afford a healthy one. Rising food prices<\/a> spiked annual headline inflation last year to a 20-month high, with food and beverage prices rising 13.1% as the price of vegetables rose \u2014 a trend that cooled in October but is expected to rise again in response to the 50% hike in fertilizer prices<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"

Your breakfast got more expensive in 2021. Expect it to continue in 2022: Extreme weather, changing consumption habits and logistical issues have converged to raise food prices 28% y-o-y in FY2021 to their highest level in a decade, according to the FAO Food Price Index (FFPI). And the FAO does not expect the trend to […]<\/p>\n","protected":false},"author":1,"featured_media":543184,"comment_status":"closed","ping_status":"open","sticky":false,"template":"single-feature.php","format":"standard","meta":{"_acf_changed":false,"newspack_ads_suppress_ads":false,"newspack_popups_has_disabled_popups":false,"newspack_sponsor_sponsorship_scope":"","newspack_sponsor_native_byline_display":"inherit","newspack_sponsor_native_category_display":"inherit","newspack_sponsor_underwriter_style":"inherit","newspack_sponsor_underwriter_placement":"inherit","ep_exclude_from_search":false,"_primary_brand":0,"newspack_featured_image_position":"","newspack_post_subtitle":"","newspack_article_summary_title":"Overview:","newspack_article_summary":"","newspack_hide_updated_date":false,"newspack_show_updated_date":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[9590],"tags":[147,633,683,564,565,182],"brand":[],"newspack_spnsrs_tax":[],"class_list":["post-543183","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-food-security","tag-climate-change","tag-enterprisepm","tag-fao","tag-food","tag-food-security","tag-inflation","wpautop","entry"],"acf":{"mongo_id":"7df07a3a-c42e-40ca-82e7-d872f0fa654f","is_powered_by":true,"story_type":"1","photo_url":"https:\/\/ent.news\/2022\/1\/446.jpg","photo_position":"above","related_issue":[543174],"teaser":"","voice_url":""},"yoast_head":"\nHow supply shortages and climate change will affect food security this year - EnterpriseAM Egypt<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/enterpriseam.com\/egypt\/2022\/01\/13\/how-supply-shortages-and-climate-change-will-affect-food-security-this-year\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"How supply shortages and climate change will affect food security this year\" \/>\n<meta property=\"og:description\" content=\"Your breakfast got more expensive in 2021. 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