While the increasing frequency of extreme weather events around the world is forecast to lead to elevated food prices and increased price surges, economists say short- and long-term policies must be developed to combat the supply problems that may arise due to these events.

According to data from the Food and Agriculture Organization of the United Nations (FAO), the FAO Food Price Index, which tracks monthly variations in international food prices, decreased by 2.6 % in May compared to the previous month and stood at 124.3 points. With this drop, the index fell to its lowest level since April 2021.

Compared to March 2022, when the record level was recorded, the fall in the prices of vegetable oils, dairy products and grains was effective in the index fall by 22 percent, while the prices of sugar and the meat remained high.

The World Bank, on the other hand, predicts that global food prices will fall 7.9 percent this year from the record level of 2022.

Despite this decline, prices are expected to remain about 9 percent above their 2021 level and 39.2 percent above their 2019 pre-pandemic level this year.

FOOD PRICES UNDER MULTIPLE PRESSURE AT THE SAME TIME

FAO economist Monika Tothova said in her assessment that the FAO Food Price Index reached an all-time high in March 2022, due to uncertainties about global food markets and exports from major players. , Russia and Ukraine, due to the war.

Explaining that the price index started to decline after peaking in March 2022, Tothova said: “Of course, food prices would not have risen as much if there had been no war. As of May, prices are down 20 percent compared to the March 2022 record level. Sugar prices have been rising for a while. There is an increase in prices due to concerns that the increase in sugar prices will affect the production side of El Niño.

Tothova, on the other hand, claimed that developments in the Black Sea Grains Initiative, as well as intense drought in regions such as Spain and North Africa in Europe, affected world food prices and continued as follows:

“When we look at all these developments, many factors are already affecting food prices at the same time. Apart from these factors, extreme weather events have a significant impact on prices. More extreme weather events are now occurring, and the magnitude and impact of these events is much greater than before. Extreme weather events can change trade routes and transportation methods for these products, as well as affect food supplies. Extreme weather events will become more frequent and massive. This will put pressure on the prices of food products, as well as on their production.”

THE GEOGRAPHY OF PRODUCTS IS CHANGING

Referring to another important effect of climate change on the food supply, FAO economist Tothova said that the places where food products are produced began to change due to climate change, saying: “As the world warms, it may start producing a product in one part. of the world that you could not produce before. Siberia is currently melting and it has become possible to grow bananas there, where bananas could not be grown before. Or, although the pepper is not produced in some parts of Europe, there are many regions where it can be produced now. In other words, the geography of products is changing.”

Regarding the high food prices in Europe, Tothova stated that European countries had to change their import destinations due to the drought.

For this reason, Tothova pointed out that imports of some products began to become more expensive with added transport costs, “it seems that prices will continue to increase compared to the previous period.” saying.

EACH NEW HOT WAVE WILL AFFECT PRICES

Mauro Pisu, a senior economist at the Organization for Economic Co-operation and Development (OECD), said that despite the recent easing, food prices are still 10 percent above the average of the last five years.

Pisu stated that changes in the balance of supply and demand are determining factors in food prices in the short term, but it is difficult to predict this dynamic.

Noting that climate change has become the main long-term driver in terms of food prices, Pisu warned that “if climate change is not properly combated, food production and prices may slowly but continuously rise.” .

Recalling the World Meteorological Organization (WMO) prediction that record temperatures may be experienced in the next 5 years, Pisu stated that there may be disruptions in food production as a result of extreme weather events that have become more frequent in different parts of the world.

Noting that it is necessary to be prepared for these interruptions, Pisu said:

“The frequency of extreme heat waves is increasing, and each new heat wave will have a direct and immediate impact on food prices. Food price increases will become more common as extreme heat waves become more frequent due to climate change. This happened last year in some parts of the world.

In the long run, the increased frequency of extreme heat waves could accelerate the volatility of food prices and the frequency of increases. These increases in food prices can have a more devastating effect, especially in developing countries.

Affecting food production due to heat waves is a supply-side problem. Addressing these supply problems requires the implementation of policies to mitigate the effects of climate change in the medium and long term, and adaptation policies in the short term. (AA)