The main reason for the rise in prices for most food products in the world was the boom in the production of vegetable fuels and the explosive growth in demand for agricultural raw materials, writes Bloomberg.
According to the newspaper, among the key crops that biofuel producers focused on were corn, soybeans, palm oil and sugar. The demand for them has grown many times over both from food producers amid the pandemic and from energy companies. The latter, in particular in the USA, are actively reconstructing oil refining facilities for the production of “green” diesel fuel. This led to the fact that corn, beans and palm oil in world markets more than doubled, and sugar – by 50%.
Energy companies, according to Bloomberg, could increase their production of biofuels by more than six times in the next few years. To do this, they intend to increase the use of discarded animal fats, used vegetable oil and distilled corn oil, not to mention an increase in demand for corn, soybeans, palm oil and sugar. Therefore, the publication says, the upward trend in food prices will continue until at least 2023.
In the European Union, according to the agency, the authorities are already taking measures to limit the use of food as raw materials for biofuel production. Almost 60% of the biodiesel feedstock consumed in the EU was imported, mainly palm oil. The rest is rapeseed, used vegetable oil and animal fat.
Earlier, the Food and Agriculture Organization (FAO) of the United Nations announced the longest rise in food prices in seven years: it has lasted for 11 months. The food price index (FFPI) in April this year amounted to 120.9 points, which is 2 points higher than in March, and 28.4 points higher than in April 2020. The FFPI value, according to FAO estimates, reached maximum since 2014
The rise in food prices in the world was reflected in Russia as well. In the fall of 2020, the price of sugar on the domestic market increased by 71%, sunflower oil rose in price by more than 23%, pasta – by 10.5%, bakery – by 6%. In December, Russian President Vladimir Putin drew attention to this. The head of state called this dynamics an attempt to adjust domestic prices to world prices, stressing that this phenomenon must be fought. In the same month, Mishustin signed a number of decrees to curb the rise in prices for socially significant products. These included agreements with food producers and suppliers to freeze prices, as well as restrictions on the export of agricultural raw materials.
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