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Why are we bullish on farm land prices? Food prices will continue to increase...

Updated: Nov 27, 2023

The rising cost of fertilizer and fuel is having a significant impact on food prices worldwide. These input costs are an essential part of modern agriculture, and the increase in their prices is making it more expensive for farmers to produce crops. As a result, food prices are rising, making it more difficult for people around the world to afford basic necessities. In this article, we will explore the reasons behind the rising costs of fertilizer and fuel, and their impact on food prices.

Fertilizer Costs Fertilizer is an essential input for modern agriculture, providing crops with the nutrients they need to grow. However, the cost of fertilizer has been steadily increasing in recent years. This is due in part to rising energy costs, as many fertilizers are produced using fossil fuels. In addition, increased demand for fertilizer, driven by population growth and the need to feed a growing world, has put pressure on prices.

According to a report by the Food and Agriculture Organization (FAO), the cost of fertilizer has increased by an average of 60% over the past decade. This increase in cost has had a significant impact on smallholder farmers, who may struggle to afford the necessary inputs to produce their crops.


Fuel Costs Fuel is another essential input for modern agriculture, powering tractors and other machinery used to produce crops. However, the cost of fuel has also been steadily increasing in recent years, driven by rising oil prices. This increase in cost has had a significant impact on farmers, who may need to spend more on fuel to produce their crops.

Impact on Food Prices The rising cost of fertilizer and fuel has a direct impact on food prices. As input costs increase, farmers may need to charge more for their crops to cover their expenses. This, in turn, leads to higher food prices for consumers. In addition, the increase in input costs may lead to reduced crop yields, further driving up food prices.


The impact of rising food prices is felt around the world, but is particularly acute in developing countries where food makes up a larger portion of household budgets. According to the FAO, food prices have increased by an average of 40% over the past decade, with the highest increases seen in developing countries.

Future Demand for Food As the world population continues to grow, demand for food is expected to increase significantly in the coming decades. According to the United Nations, the global population is expected to reach 9.7 billion by 2050, up from 7.9 billion in 2021. This increase in population will put further pressure on food production, and will likely lead to continued increases in input costs.


Conclusion The rising cost of fertilizer and fuel is having a significant impact on food prices worldwide. As input costs increase, farmers may struggle to afford the necessary inputs to produce their crops, leading to reduced yields and higher food prices. This, in turn, makes it more difficult for people around the world to afford basic necessities. As the world population continues to grow, demand for food is expected to increase, putting further pressure on food production and input costs. It is essential that policymakers and stakeholders work together to find sustainable solutions to these challenges.



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