Food Prices Could Rise 15 Per Cent

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Food Prices Could Rise 15 Per Cent

Food Prices Could Rise 15 Per Cent

Inflation is on the rise and mainly due to the aftereffect of coronavirus and the Russian invasion of Ukraine. Amid such a challenging situation, prices of necessary items are increasing. It is warned that food prices may rise by about 15 percent in 2022.

According to Ronald Kers, CEO of 2 Sisters, the company is currently paying about fifty percent more to procure chicken from the farms.

Most European countries have been highly dependent on Russia and Ukraine for gas, oil and wheat. The prices of these have lately skyrocketed and this had generated pressure on the margins of food producers.

Kers further said that it is the right time for the UK to produce more and import less as the situation may become worse if the Russian-Ukraine conflict carries on for months. They need to work with the supply chain partners to look for a solution to the rising price even though the issue is very complex.

Meanwhile, farmers have called the government to intervene immediately and take measures in halting the rising prices of food items and simultaneously prevent food shortages.

The farmers union has approached the ministers through a letter, warning of several compounded factors which may lead to food security risks.

The Russian-Ukraine war has led to shortages of oilseed and grain while the energy costs have skyrocketed for food producers.

Meanwhile, the farmer union has warned of labor shortages or hikes in the labor costs as thousands of seasonal workers are required and more than half of the total come from Ukraine.

The union has simultaneously asked for prioritization of gas energy in the food production segment and to pave the way for easy use of organic fertilizers.

Abreast of all these, non-food inflation has also surged to a significant level. Prices of non-food products have increased and it is at the highest rate since September 2011.

Russia initiated an invasion of Ukraine on February 24 and amid criticism from most countries across the world it has not withdrawn troops. The war has now entered its second month and Russian missiles have damaged key cities of the country.

The Western allies have imposed sanctions on Russia including a ban on the import of oil and gas from the country as well as removing Russian banks from the international SWIFT payment systems. All these have led to the rise in inflation in European countries as no alternative supplies of oil and gas have yet been worked out.

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