Experts issue dire warning as food prices rise faster than inflation: 'This process is affecting multiple regions worldwide'
A recent version of the Ibre Letter, a monthly economic analysis from Brazil's Institute of Economics at the Getúlio Vargas Foundation, explained why domestic food prices are rising faster than the country's general inflation. And while the answer was complex, a lot of it came down to changes in weather and climate, Agência Brasil reported.
Ibre's research included statistics from the National Consumer Price Index (IPCA), which found that Brazil's food and beverage prices had risen by 7.25% over 12 months as of February. This was nearly twice as much as the overall inflation index of 4.56%.
Between 2012 and 2024, household grocery and food prices rose by 162%. Ibre included several specific examples that illustrate the extreme increases, including fruit (up 299%) and vegetables (up 246%). When compared to the overall IPCA of 109%, several of these categories outpaced overall inflation by a factor of nearly two or three times.
Ibre's author, Luiz Guilherme Schymura, explained that much of it comes down to a short supply, which has been intensified by rising global temperatures.
A spike in extreme weather events and meteorological unpredictability, which are fueled by the planet's warming atmosphere, "are disrupting the supply of commodities [goods traded at international prices] and food products," he told Agência Brasil. "This process is affecting multiple regions worldwide, with Brazil being notably impacted."
With severe droughts, flash floods, heat waves, tornadoes, and hurricanes all growing in severity and frequency due to the warming planet, farmers are anxious about being able to sustain stable harvests in the future.
The issue extends beyond crops, too. Beef production dropped substantially in 2021 after pastures suffered significant damage from drought. In 2023, it had reached its lowest point in at least 10 years, Agência Brasil explained.
The issue of a dwindling food supply isn't limited to just Brazil, and Brazilians won't be the only ones facing its impact.
Ibre explained that agricultural production around the globe grew an average of 2.6% per year in the 1990s and 2000s but slowed to 1.9% in the 2010s. Much of this is due to unfavorable weather and climate conditions. Farmers worldwide have faced difficulties due to these factors, from sweetcorn in the Netherlands, to soybeans in Argentina, to apples in India.
Ibre put it frankly: "Brazil is not producing enough food for its own population and the world. Crop production is growing at a slower pace than needed to meet domestic and international demand for food, particularly for human consumption."
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The Ibre Letter emphasized that "the rise in food prices is not a temporary phenomenon" and therefore must be dealt with both now and in an ongoing way.
Schymura recommended several practical approaches for both farmers and policymakers, all of which he says will help stabilize and boost the food supply. These suggestions include incorporating a wider variety of crops, building storage structures and public storage areas, and providing targeted credits to farmers.
On an individual level, learning to shop smarter at the grocery store can help you squeeze more savings out of your grocery bill. And if you really want to cut back on grocery costs, learning to grow your own food is a great way to both save money and eat healthier.
Join our free newsletter for easy tips to save more and waste less, and don't miss this cool list of easy ways to help yourself while helping the planet.
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