spikes in oil and mineral prices after Russia’s invasion of Ukraine
have distracted investors from the
long-lasting and more
dangerous impact of
BlackRock founder Larry Fink has warned.
thing I worry about that we don’t talk enough about is food,” he told
the Financial Times. “This
geopolitical concerns that
of energy, petrol and petroleum-based agricultural inputs shot up
earlier this year when
oil costs were also
hit hard because Ukraine is a major exporter.
begun to drop back down this week to
as traders brace for a sharp drop-off in
consumption. But food price inflation remains stubbornly high. The US
consumer price index figures for
to 20 per cent year
on year and margarine has jumped 34 per cent.
issue is food,” Fink
said. “There has been tremendous destruction of arable land in
fertiliser is up
additional cost is
amount of fertiliser
used in farming That is
harming the quality of the crop worldwide.”
Larry Fink: ‘This
isn’t just an inflation concern. There are also geopolitical
concerns that result from this’ © Bloomberg
lower oil prices have started to feed through to the price at the pump
for motorists, consumer
is likely to come too late to boost this year’s food harvests.
this year, far outpacing raw materials.
is particularly grim in Africa, which usually imports grain from
Ukraine as well as producing its own food. Fertiliser prices there
have risen 300 per cent, and the continent is facing a shortage of 2mn
metric tons, according to the African Development Bank. It has
could fall by 20 per cent this year.
extremely difficult time for global food security” and urged
the G20 group of leading nations to halt stockpiling and export
restrictions on food and provide additional financial assistance to
countries and people struggling with food insecurity.
the philanthropist and Microsoft co-founder, flagged similar concerns
this week, saying that
war in Ukraine was
“driving up food prices, which will increase malnutrition and
instability in low-income
agricultural productivity in
Africa required “far more investment”.
food price inflation
will begin to ease, others are preparing for the worst.
foodmaker Mondelez is seeing so much inflation and “availability
issues” in edible oils and
flexible formulation to make
ingredients and components that are in shortage with something that is
more available,” Luca Zaramella, the chief financial officer said last
Mills is predicting a “significant step up in input cost inflation” to
14 per cent for the fiscal year that
Jeff Harmening said last
of Cheerios as
Pillsbury and Betty
consumer spending power”.
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