During 2020, companies in the region bought corn abroad for $998 million, 5% more than what was reported in 2019, a variation that is explained by the increase in imports from Nicaragua, Guatemala, Honduras, Panama and Costa Rica.
Figures from the Trade Intelligence Unit of CentralAmericaData: [GRAFICA caption="Click to interact with the graph"]
The increase in the international prices of corn and soybeans, inputs used to produce animal feed, threatens to put upward pressure on the production costs of meat, eggs and dairy products.
In recent months, the international price of a bushel (27 kilos) of soybeans increased by 28%, from $10.6 to $13.62, between November 1, 2020 and January 28, 2021.
Due to the high geographic concentration of global production, Central America has increased its imports, but at the same time has become more vulnerable to crop losses, rising international prices and possible disruptions in supply chains.
The importance of the market for this type of food is that rice, wheat, corn, beans and soybeans are basic foods on which the world's population largely depends, since it is estimated that almost half of the calories consumed by people come from these foods.
In order to ensure that a possible de-regulation would not generate an unjustified increase in the products considered to be of greater sensitivity, the government decided to extend the price control system of the basic basket for six more months.
At present, the list of products whose prices are controlled includes beef slices, ribbon steaks, ground beef, whole chicken, rice, onions, yams, national potatoes, perita tomatoes, cassava, powdered milk, sliced bread, processed American yellow cheese and sausages.
In the context of the covid-19 crisis, the Salvadoran authorities decided to establish a maximum price for all products in the basic basket.
The Consumer Defense Office has selected beans, corn, rice, milk and eggs as essential products, which must be kept at accessible prices in the local market.
In the second month of this year, the FAO food price index rose by 8 percent compared to the same month in 2019, explained by rising prices of meat, dairy products, vegetable oils and sugar.
From FAO's monthly report:
-The FAO Food Price Index* (FFPI) averaged 180.5 points in February 2020, down 1.9 points (1.0 percent) from January but still 13.5 points (8.1 percent) higher than in February 2019. The decline marked the first month-on-month drop in the value of the FFPI following four months of successive increases. It was driven by a sharp fall in the export prices of vegetable oils and, to a lesser extent, meat and grains, more than offsetting a continued rise in dairy and sugar prices.
Up to January this year, the FAO food price index rose by 11% compared to the same month in 2019, explained by the increase in the prices of meat, dairy products, vegetable oils and sugar.
From FAO's monthly report:
» The FAO Food Price Index* (FFPI) averaged 182.5 points in January 2020, up 1.3 points (0.7 percent) from December 2019 and 11.3 percent higher than the same month last year.
Although at the beginning of the Cortizo administration it was announced that the price control system for the basic basket would be gradually removed, now the Panamanian president is threatening to add products that were already excluded again, if their prices rise.
On January 7, it was confirmed that the price control on 14 products of the basic family food basket would be extended for six more months, a measure that was rejected by the Panamanian business sector.
As of December last year, the FAO food price index was up 13% over the same month in 2018, explained by rising prices of meat, dairy products, vegetable oils and sugar.
From the monthly report of the FAO:
» The FAO Food Price Index* (FFPI) averaged 181.7 points in December 2019, up 4.4 points (2.5 percent) from November, marking the third month of consecutive increase. Strong rallies in vegetable oils, sugar and dairy markets pushed up the overall value of the Index to its highest level since December 2014. However, for 2019 as a whole, the FFPI averaged 171.5 points, only 3 points (1.8 percent) higher than in 2018 and still significantly (58 points or 25 percent) below its peak of 230 points registered in 2011.
Panamanian businessmen are opposed to extending price controls on 14 products in the basic family food basket for six months.
The list of products whose prices are controlled includes slank, ribbon steak, ground beef, whole chicken, rice, onions, yams, national potatoes, perita tomatoes, yucca, powdered milk, sliced bread, processed American yellow cheese and sausages.
In the tenth month of the year, the FAO food price index rose 6% from October 2018, explained by rising prices of sugar, meat, dairy products and vegetable oils.
From FAO's monthly report:
» The FAO Food Price Index* (FFPI) averaged 172.7 points in October 2019, up 1.7 percent (3 points) from September and 6.0 percent higher than in the corresponding period last year. The increase in October marked the first significant month-on-month rise in the value of the Index since May 2019, as surges in the prices of sugar, cereals and, to a lesser extent, meat and vegetable oils, more than offset a small decline in the value of the dairy sub-index.
In the ninth month of the year, the FAO food price index increased by 3% compared to September 2018, explained by the rise in the prices of sugar, meat, dairy products and vegetable oils.
From FAO's monthly report:
» The FAO Food Price Index* (FFPI) averaged nearly 170 points in September 2019, unchanged from August but 3.3 percent higher than in the corresponding period last year. While in September sugar prices fell sharply, the decline was almost entirely offset by higher prices of vegetable oils and meat. The Dairy index was down only marginally, whereas that of cereals remained steady.
In the first quarter of 2019, the countries of the region imported $108 million in animal feed preparations, 8% less than what was reported for the same period in 2018.
Figures from the Trade Intelligence Unit of CentralAmericaData: [GRAPHIC caption="Click to interact with graphic"]
In the eighth month of the year, the FAO food price index fell 2% from July 2019, explained by the decline in the prices of sugar and main cereals.
From FAO's monthly report:
» The FAO Food Price Index* (FFPI) averaged 169.8 points in August 2019, down 1.1 percent (almost 2.0 points) from July but still 1.1 percent higher than in August 2018.
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