Red Sea crisis set to send food price higher — FAO

World 09:33 04.03.2024

The Houthi blockade of the waterways across the Bab al-Mandab Strait and the Red Sea is taking a toll on global food trade, causing prices to rise, said Oleg Kobyakov, the director of the office for liaison with Russia at the UN Food and Agriculture Organization, Ednews reports.

"The blockade of the Bab-el-Mandab Strait and the Red Sea by the Houthis is having a negative impact on global food trade. The cost of chartering a ship to travel along this route has almost quadrupled while cargo traffic has dropped by 30%," he said in an interview with TASS.

The FAO official said the world's largest shipping companies refused to deliver goods through the Red Sea.

"This has disrupted established supply chains. Cargo owners are forced to use a roundabout route, sending ships around the Cape of Good Hope to travel between Asia and Europe. This route is 8,000 kilometers longer and takes 10-14 days more, and the cost of buying additional fuel increases expenses by an average of 15%," he said. "As a consequence, food price rise. This results in food inflation and reduced affordability of food products for the end consumer."

Kobyakov then shared an outlook given by FAO Chief Economist Maximo Torero at the Global Forum for Food and Agriculture in Berlin in January: "There are growing risks in the Red Sea, risks in the Black Sea, and risks we could face from lower water levels in the Panama Canal, which is a key waterway for us in moving goods around the world."

Following the escalation of the Palestinian-Israeli conflict in the Gaza Strip, the group, also known as the Houthis, said they would strike Israeli territory and prevent ships affiliated with that country from passing through the Red Sea and the Bab al-Mandab Strait until the operation in the Palestinian enclave ended. The Houthis have attacked dozens of civilian ships in the Red Sea and the Gulf of Aden since mid-November.

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