Business a.m
A recent study conducted by the Food and Agricultural Organisation (FAO), in collaboration with the World Food Programme (WFP) and other agencies, has projected that the average price of staple foods such as rice, maize, millet, wheat, and cereals will rise above the five-year average, which is the period from 2019 to 2023, in West Africa countries including Nigeria.
The report titled “West Africa Regional Supply and Market Outlook,” attributed the projected increase to several factors due to several factors including lower production levels, trade restrictions, high energy prices, and the ongoing Russia-Ukraine war, all of which are putting upward pressure on food prices.
Additionally, the report highlighted other factors that could contribute to the rising prices of staple foods, such as the depletion of global grain reserves, natural disasters, climate change, and the impact of COVID-19 on the food supply chain.
“Staple prices currently remain above the five-year average across the region. This is attributable to a combination of factors including production deficits, trade restrictions, insecurity in the Sahel, elevated global prices, high transaction costs, and currency depreciation in the coastal countries of the Gulf of Guinea,” the report noted.
The report also indicated that despite an increase in rice production, it would not be sufficient to cover the shortfall in other staple foods such as maize, sorghum, and millet. It further noted that imports would likely decline, due to the effects of restrictions on global trade, high shipping costs, lower national exchange rates, and domestic policies such as import tariffs and exchange rate regimes.
The FAO report also projected positive production outlooks for some root and tuber crops like cassava and yam, as well as cash crops, such as coffee, cocoa, and cashews. These crops are expected to have strong production in major coastal countries like Ghana and Ivory Coast. However, the report warned that despite the positive outlook for these crops, production could still be affected by high energy prices, weather-related shocks, and trade restrictions.
Oil windfall expectations from the Middle East crisis