Food Inflation: Good or Bad for Agri Marketplace?

There are several different factors that contribute to rising food prices. Right now, the unrest in Ukraine, global warming, and the cut in concessions in several countries for fertilizer prices have contributed to the rising food prices. The rise in supply chain disruptions also contributes to the increasing food prices. 

What are the issues surrounding food inflation? 

All around the world, countries experience food inflation. Currently, The global food inflation rates stand tall at 5.9% per annum. It is a shockingly high rate, but a 5.9% food inflation rate isn’t too bad, keeping the current global situation in mind.

The rising food inflation rate brings a series of pre-existing issues to the forefront. 

• A lot of farmers are leaving their occupations. As countries worldwide allow more and more wholesale buyers to determine the market rate for Agri produce, the market will tend to skew in favor of wholesale buyers. As a result, most farmers can’t even break even with their harvest. 
• Not enough attention is being paid to sustainability farming. Scientists and advocates of sustainable farming have been trying for decades to bring this issue to the forefront. Without sustainable farming, soil quality continually erodes and then a point comes in the future when the soil can’t yield as much produce as the previous seasons. 

Thus, we can see that food inflation actually points toward a much larger problem. There are several measures the government can take to solve the problem of food inflation at the root. 

Research also shows that countries that are self-sufficient in their food production will experience a lower food inflation rate. Take France as an example- France only needs to import some types of vegetables and fruits. Their food inflation rate stands at only 3.2% per annum. 

In contrast, Greece has a food inflation rate of 8.1%. They are still recovering from the dual blow of Greece’s economic crash and the pandemic. They naturally have to import more essential Agri produce than other EU countries which contributes to the high food inflation rate.
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Is the Food inflation bad or good for the Agri Marketplace?

As food inflation rises higher, it is important for the buyers and suppliers of agricultural produce to work hand in hand. Inflation happens in all sectors of the economy, what is important is our capacity to adapt to these changes. 

With every type of transaction in the world shifting to e-platforms, the Agri marketplace could no longer be left behind. 

Food inflation has brought with it the capacity for institutional buyers to grossly underprice produce and harm farmers. On the flip side, the farmers can also unfairly overvalue their produce. Using an online Agri marketplace, prices can be shown from the very beginning, and the forces of market demand will drive transactions. 

O’AgriFarm is one such Agri Marketplace. Its focus is on making it easier to connect buyers to suppliers in the marketplace with the highest level of transparency.