Food imports to hit record on high prices

The world food import bill is forecast to reach a new record this year, though it is predicted to grow at a much slower pace compared to last year as rising world prices dampen demand, especially in the most economically vulnerable countries.

The "Food Outlook" a biannual report of the Food and Agriculture Organisation (FAO), estimates that the global food bill will rise to $1.98 trillion in 2023, up 1.5% from 2022. It rose by 11% in 2022 and 18% in 2021.

While food imports by advanced economies continue to expand, the import bill for the group of Least Developed Countries is predicted to decline by 1.5% this year and that for net food-importing developing countries (NFIDCs) to decline by 4.9%, according to the FAO report.

"The decline in food import volumes is a concerning development in both groups, suggesting a decline in purchasing capacity," the report warns. "These concerns are amplified by the fact that lower international prices for several primary food items have not, or at least not fully, translated into lower prices at the domestic retail level, suggesting that cost-of-living pressures could persist in 2023."

The report containing forecasts of the production, trade, utilisation and stock levels across the world's major basic foodstuffs, point to likely increases in production across most categories, including rice, coarse grains, oil crops, milk, sugar, meat and fish and fishery products. However, global wheat output could fall from last season's all-time high.

Global production of coarse grains is forecast to rise by 3% to 1 513 million tonnes, a new record, buoyed by an expected significant increase in maize output in the United States of America and a record harvest in Brazil, leading to higher overall supplies and lower prices.

World rice production is forecast to rise by 1.3% in 2023-24 to 523.5 million tonnes, while international trade is expected to drop by 4.3% in volume terms to 53.6m tonnes. The anticipated output increase mostly reflects positive incentives provided by generally higher producer prices, easing fertiliser costs and continuing government assistance measures.

A sizeable export contraction is also envisaged for Pakistan, with Argentina, Brazil, the Russian Federation and the United States of America expected to export less as well, the report says.

The forecast for world sugar production in 2022-23 is pegged at 177.5m tonnes, up 1.9m tonnes, or 1.1%, from the 2021-22 outturn. Global sugar consumption is forecast to continue increasing for a third successive season in 2022/23, up 1.6 million tonnes, or 0.9%, from the previous season. Overall, the year-on-year growth is expected to mostly originate in Africa and Asia, driven by population and income growth.

By contrast, world wheat production in 2023 is expected to decline by 3% from its all-time high of 777m tonnes in 2022, due mainly to expected decreases in the Russian Federation and Australia, both of which registered record outputs last year. The declines mostly reflect the likely impacts of extreme weather events, seen leading to lower planted areas.

The report says global outputs of oil crops, milk and sugar are all expected to expand, as is that for meat, although pig and bovine meat volumes could drop slightly in 2023. Global production of aquatic animals is also expected to grow in 2023, although that is due to an anticipated increase in aquaculture production as capture fisheries are seen contracting.