[ad_1]
Global food prices rose for the eighth consecutive month in January to reach their highest level since July 2014, according to the latest data from the United Nations Food Price Index and agriculture (FAO), which turns out to be a boon for farmers but could also domestic inflation. Rising food prices could complicate the country’s nascent economic recovery, analysts say.
Rising international food prices are boosting India’s food exports, but it will make food imports from India more expensive. The country, for example, relies on imports to cover 70 to 74% of its needs for vegetable or edible oils.
The FAO Food Price Index, which measures monthly changes in a basket of grains, oilseeds, dairy products, meat and sugar, averaged 113.3 points in January 2021, 4, 7 points (or 4.3%) more than in December 2020, according to the United Nations agency.
Read also | PSB map ₹A 70,000 crore fund to boost the agricultural sector
This is the eighth consecutive month of increase, but also the highest monthly average since July 2014. This surge was led by higher prices for sugar, grains and vegetable oils, while meat and vegetables. dairy products have also increased.
China stores grain. Argentina has suspended export sales of corn. Russia imposed taxes on wheat, barley and corn exports, putting prices under pressure.
“India will be the most affected by an increase in the prices of edible oils. India imports 70% of its needs. International shortages are high, ”said Abhishek Agrawal of Comtrade, a commodity trading company.
The FAO vegetable oil price index averaged 138.8 points in January, up 7.7 points or 5.8% from December, marking the highest level since May 2012. The drop of palm oil production in Indonesia and Malaysia is to blame, Agrawal said.
Sugar prices jumped 8.1%, with lower production in the European Union, Russia, Thailand and South America.
Strong increases in commodity prices, however, boosted India’s commodity exports. Cotton has become a quarter percent more expensive in international markets, prompting the Cotton Corporation of India to forecast aggressive exports of cheaper fibers from India.
India’s cotton shipments are expected to reach 7.5 million bales (170 kg each) compared to 5 million bales exported last year, according to a forecast from the Cotton Corporation of India.
Domestic soybean prices are currently selling 10% above minimum support prices, Agrawal said, thanks to sustained exports. Firmer international demand and price increases for corn, wheat and soybeans could prove to be a boon for Indian producers.
India’s exports of basmati and non-basmati rice are expected to be around 17 million tonnes compared to 9.5 million tonnes in the previous fiscal year, with an 80% increase in exports between April and December 2020, according to official data.
Source link
