The report, to be released later this month, reveals how between 2020 and 2024, the world experienced a dramatic increase in food prices driven by a combination of COVID-19 inflation, the war in Ukraine restricting movements on food and commodities, and increasing climate shocks.
“The episodes described in this publication bring up what we call a perfect storm,” said Mr. Torero Cullen.
First, he explained that during the COVID-19 pandemic, governments launched fiscal stimulus and relief packages, which increased demand and, thus, global inflation.
Russia’s full-scale invasion of Ukraine compounded this crisis. Before the war began in 2022, Ukraine was a key exporter of wheat, sunflower oil and fertilisers. The war not only restricted these exports but disrupted trade routes and pushed up fuel and input costs, which amplified inflation across the world.
Additionally, increasingly frequent and intense climate shocks in major producing regions – such as droughts, floods and heat waves – further aggravated food inflation.
Worldwide impacts
Only in 2024 did prices return to pre-COVID levels, meaning that households struggled for multiple years to afford food, with major consequences.
As real wages fell while food prices increased, household purchasing power was eroded. Households responded by buying cheaper and less nutritious food, reducing meal frequency, and often prioritising meals for certain family members and reducing intake for women and children.
Mr. Torero Cullen also explained that an increase in food prices directly correlates to an increase in moderate and severe food insecurity. The impacts of this were particularly harsh in Africa and Western Asia, where food imports, dependence and currency depreciation made food even more expensive.
Moreover, as food prices increased, nutrition outcomes among children under five worsened. The SOFI report illustrated that a 10 per cent food price increase led to a 2.7 to 6.1 per cent increase in moderate to severe wasting, which has long-lasting effects on child development and public health systems.
Notably, these grave impacts were uneven, mostly affecting low-income and African countries – many of which are still seeing worsening figures. During the peak of the crisis in January 2023, some low-income countries experienced food price inflation of up to 30 per cent, compared to 13.6 per cent globally.
Policy recommendations
Mr. Torero Cullen finished his briefing by outlining the policy prescriptions detailed in the SOFI report.
He first underscored targeted fiscal support. “Social protection measures are the most effective response to food price spikes,” he explained. “This will protect vulnerable populations without creating long-term fiscal risk or market distortions.”
He also highlighted avoiding trade disruptions, coordinating monetary and fiscal policies, improving market transparency, and institutional preparedness as essential components for avoiding future crises.
“This SOFI underscores that inflation can undermine progress. It underlines our vulnerabilities, and it also brings the importance of strengthening resilience, inclusiveness and transparency to be able to avoid and minimize the risk of these problems,” he concluded.
