The average UK family now spends £750 a year more on food than 12 months ago; the world’s grocery bill has jumped by 21% this year; Russian bread prices have doubled; and three people have been killed in a cooking-oil stampede in China.
Food inflation is rising sharply as agricultural markets are straining to keep up with demand, and the “farm crunch”, as Ambrose Evans-Pritchard puts it in The Daily Telegraph, is far from over.
Over the past 20 years food output has risen by an annual 1.3%, while population growth has climbed by 1.35%. The global population is set to jump from 6.6 billion to 8.3 billion by 2030, while mounting wealth among consumers in developing countries is spurring a shift towards greater protein consumption. This implies higher demand for grains, as it takes about 7kg of animal feed, such as soya or corn, to produce 1kg of meat.
Note that China has now become a net importer of corn for the first time. The trend towards biofuels is also underpinning demand, while urbanisation and land degradation are crimping the supply of arable land.