Cost pressure on key ingredients to continue

Price pressure on key ingredients used in seafood formulations will continue for decades, as new report predicts food prices will double by 2030.

In its report “Growing a Better Future,” the non-government organization Oxfam concluded that in 20 years food prices could rise by 70 to 90 percent.

“The food system is buckling under intense pressure from climate change, ecological degradation, population growth, rising energy prices, rising demand for meat and dairy products, and competition for land from biofuels, industry and urbanization,” said the report.

Crucially, Oxfam warns of a price hike for key staples from 120 to 180 percent by 2030.

In 2008, soaring prices for key commodities such as wheat and corn sparked food riots across the globe and sent profits plunging for food firms on squeezed margins. At the time, observers attributed the price hikes to a multitude of reasons: adverse weather, rapid expansion of biofuel production, petrol price rises, protective policies and even the contribution of speculators on the financial markets to price volatility.

The global seafood industry witnessed price rises for key ingredients sourced from commodities, such as wheat that yields starch and flour. Prices for corn, a versatile cereal that delivers cooking oil, high fructose corn syrup and starch, doubled between 2007 and 2008.

And soy — derivatives of which include oil and protein and increasingly used by the food industry — also spiked.

The Oxfam report underlines that climate change will be responsible for half of the predicted rise in food prices. It is calling on nations to agree new rules to govern food markets.

“As we lurch uncertainly into the age of crisis, facing our second global food price spike in three years, more must be done to build resilience and manage the climatic and economic risks looming on the horizon,” said the report.

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