Apr 12, 2022 - Economy

Russia's invasion pushed global food prices to record high

World food price index
Data: UN Food and Agriculture Organization; Chart: Kavya Beheraj/Axios

Food prices soared to record highs last month, as the war in Ukraine exacerbated what was already a global crisis.

Why it matters: In poorer countries where folks spend upward of 50% or more of their income on food, these numbers are devastating.

State of play: The tools that central banks are using to fight inflation — rate hikes, quantitative tightening — are meant to curtail demand, but can do little to address global supply problems.

  • "Raising rates will not resolve the war or address the supply chain," said Jean Boivin, head of the BlackRock Investment Institute.

Behind the numbers: The index tracks a basket of commodities including cereals, vegetable oils, dairy, meat and sugar.

  • The prices of wheat and sunflower oil, in particular, are rising because of the war. Some Ukrainian ports are closed and others face disruptions.
  • Issues will certainly drag into next year as some farmers in Ukraine — the leading sunflower-oil exporter and a top grains supplier — are unable to plant crops.

What's next: The U.S. is also struggling with rising food prices. Expect to hear more about that Tuesday morning, when the March Consumer Price Index is released.

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