Food prices will remain high due to labor crisis

Food prices are likely to remain high in 2022 as disruptions in global supply chains will persist, according to the head of Cargill Inc., who highlighted labor shortages as one of the biggest risks facing the industry. .

Whether it is meat processors, truckers, warehouse operators or port personnel, the global food system is experiencing increased competition for workers.

The plants are not operating at full capacity, limiting the food supply and creating the potential for further price hikes, he said. David MacLennan, executive director of the agricultural power.

“I thought that inflation in food and agricultural products was transitory. Now it doesn’t seem that much to me anymore due to continuing shortages in the labor markets“, said MacLennan in an interview on the Bloomberg New Economy forum in Singapore. “That is one of the factors in the supply chain that we are watching more closely. “

World food prices rose to a decade-high high in October, threatening even higher bills for food purchases and could worsen world hunger. The global food ecosystem is under pressure due to understaffing.

Poor weather conditions affected crops this year, transportation costs skyrocketed and labor shortages have affected the food supply chain. Added to that, an energy crisis has caused a sharp increase in fertilizer bills for farmers around the world.

MacLennan He said in September that the increase in food costs would be temporary and should dissipate over time. Since then, rising energy prices and continuing complications in supply chains have made markets “much tighter“, said.