How global trends influence food prices

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Agrofood Sector Risk Report

Overview

Generally, worldwide food prices stabilised in 2017, having been exceptionally high before. For example, sugar prices, always volatile, fell sharply in 2017 after steep rises in the previous year, partly because European Union sugar quotas ended. Rising demand in the EU and China, plus reduced beef production in Oceania caused global meat prices to rise in 2017.

 

Coface Regional Sector Risk Assessment

Strengths and weaknesses

In 2018, Coface analysts expect global food price rises to become a long-term trend, driven by increasing demand from emerging nations – especially China and India. Another factor is changing culinary culture in emerging Asian countries, with increasing demand for cereals and dairy produce. The sector’s main threats are climatic fluctuations, such as extreme weather events. Political factors also have impact, such as the Russian embargo on food products from the USA and EU. In the main consumer countries, rising food prices are also likely to cause a fall in purchasing power.

In a sector so vulnerable to the vagaries of the climate and to political and economic changes, volatility is the only certainty. Coface credit insurance is a wise way to protect your business from bad debt in such an unpredictable world.

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For a far more detailed insight into the agrofood sector, download the full sector report or contact us for more information about how Coface can help your business.

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