Global Food Inflation Is Leading To A Frightening Explosion In Global Hunger
We are currently facing “the worst food crisis in modern history”, and it seems to be getting worse with each passing month. I don’t have to tell any of you that food prices are a lot higher than they once were. The last time you went to the grocery store you could see that for yourself. Sadly, this is taking place all over the world, and the poorest countries are being hit the hardest. Meanwhile, global food supplies just continue to get tighter and tighter. As a result, global hunger is on the rise. If you doubt this, I would like for you to read an excerpt that comes directly from a joint statement by the heads of the Food and Agriculture Organization, the International Monetary Fund, the World Bank Group, the World Food Program and the World Trade Organization:
“Globally, poverty and food insecurity are both on the rise after decades of development gains. Supply chain disruptions, climate change, the covid-19 pandemic, financial tightening through rising interest rates and the war in Ukraine have caused an unprecedented shock to the global food system, with the most vulnerable hit the hardest. Food inflation remains high in the world, with dozens of countries experiencing double digit inflation. According to WFP, 349 million people across 79 countries are acutely food insecure. The prevalence of undernourishment is also on the rise, following three years of deterioration. This situation is expected to worsen, with global food supplies projected to drop to a three-year low in 2022/2023. The need is especially dire in 24 countries that FAO and WFP have identified as hunger hotspots, of which 16 are in Africa.”
Please take a few moments and read that paragraph again. We really are facing “an unprecedented shock to the global food system”, and these global leaders really are telling us that the situation “is expected to worsen”.
At this point, events are so bad that even CNN is admitting that we are currently experiencing “the worst food crisis in modern history”.
Yet the world is still in the grips of the worst food crisis in modern history, as Russia’s war in Ukraine shakes global agricultural systems already grappling with the effects of extreme weather and the pandemic. Market conditions may have improved in recent months, but experts do not expect imminent relief.
That means more pain for vulnerable communities already struggling with hunger. It also boosts the risk of starvation and famine in countries such as Somalia, which is contending with what the United Nations describes as a “catastrophic” food emergency.
So what takes place if some “black swan events” come along in 2023 and make the global food crisis far worse than it already is?
In some of the poorest countries on the planet there are already vast numbers of people without enough food to eat. For example, in Somalia almost half of the entire population is in need of “immediate lifesaving aid”.
Somalia is in the midst of the longest and most severe drought in its history, following five consecutive poor rainy seasons, which has devastated the country. Roughly 8.25 million people, nearly half the population, require immediate lifesaving aid and protection.
Sadly, the truth is that this is just the beginning. Experts claim the conditions will inevitably get a whole lot worse no matter what our leaders do now.
Here in the United States, nobody is in danger of starving to death at this stage. But prices just continue to escalate. In fact, the new inflation numbers that we got from the government were not good news at all.
Republican lawmakers slammed President Biden after the latest inflation report, with one saying the president is “living in an alternate reality.” The congressional Republicans ripped into Biden after the latest inflation report that saw prices rise by 0.5 points to a 6.4 percent rate in January.
“Recently Joe Biden took a victory lap on the economy, but today’s report confirms he’s living in an alternate reality than Americans watching prices get higher by the day,” House Majority Whip Tom Emmer, R-Minn., told Fox News Digital in an exclusive statement.
Even though the Federal Reserve has aggressively hiked interest rates, inflation has not been tamed.
In particular, food prices just continue to go up and up. Jacki Kotkiewicz posted some numbers on her Twitter account that show how dramatically prices in certain key categories have risen over the past year:
- Overall CPI: +6.4% y/y
- Fuel Oil: +27.7%
- Electricity: +11.9%
- Groceries: +11.3%
- Milk: +11%
- Eggs: +70.1%
- Bread: +14.9%
- Potatoes: +12.4%
- Baby Food: +10%
- Airline Fares: +25.6%
- Real Average Hourly Earnings: -1.8%
When I go to the grocery store now, there are some products that I simply will not buy unless they are on sale. Even the price of butter is going up. The last time I was in the grocery store, I spent nearly 30 dollars just on butter. Can you believe that?
Unfortunately, we all have to adapt to this new reality. The cost of living has become extremely oppressive, and at this point close to two-thirds of the entire nation is living paycheck to paycheck.
Rising prices have weakened consumers’ spending power, as inflation remains elevated and the Federal Reserve continues to tighten its monetary policies. Against the backdrop of recession risk and growing macroeconomic uncertainty.
In a report by PYMNTS in collaboration with LendingClub it was found that 64% of U.S. wage earners are currently living paycheck-to-paycheck. Even those that earn $100,000 or more per year are feeling the financial pinch as prices continue to climb and interest rates remain high.
As I end this article, there are a couple of aspects that I think that it is imperative for all of us to understand.
- Number one, we were all warned that this crisis was coming.
- Number two, eventually this crisis is going to get a whole lot worse.
We are only in the very early chapters of this nightmare, and much more pain is ahead.
So I would urge you to act accordingly, because the global food crisis is only going to intensify from this point forward.
Author: Michael Snyder
March 26, 2023