Super El Ni?o Strikes... Grocery Shopping Becomes More Daunting

April Sugar Raw Material Refined Sugar Price
Highest in 11 Years 6 Months
Significant Drop in Southeast Asia Rice Production
Economic Loss of $5.7 Trillion During Late 90s Super El Ni?o

This summer, the arrival of a super El Ni?o accompanied by heatwaves and heavy rains is expected to further intensify the food inflation crisis. Amid soaring grain prices caused by extreme weather anomalies and the Russia-Ukraine war this year, the price surge is anticipated to accelerate even more.

Worsening Food Inflation

The Nihon Keizai Shimbun recently reported on food inflation, conveying experts' forecasts on the 17th that the super El Ni?o arriving this summer could act as a catalyst for rising food prices.

Recently, the price of raw sugar, the raw material for sugar, reached its highest level in 11 years and 6 months in April. Compared to the end of 2019 before the spread of COVID-19, it has surged more than eightfold. Raw sugar refers to unrefined sugar extracted primarily from sugarcane, and production has significantly decreased due to droughts in India, a major sugarcane producer.

The price of cocoa beans, the main ingredient in chocolate, also hit a 46-year high as of the end of last month. Prices rose due to reduced harvests caused by severe droughts in C?te d'Ivoire, Africa's largest cocoa producer.

Rice production in Southeast Asia is expected to decline sharply. The United States Department of Agriculture (USDA) has lowered its forecast for rice production in Thailand, a major global rice exporter, to 19.7 million tons for this year and next, down by 800,000 tons from previous estimates. This adjustment reflects a 28% decrease in rainfall compared to the same period last year. During the El Ni?o event in 2019, Thailand's rice shipments also dropped drastically to about one-third of normal levels.

The adverse effects of weather anomalies extend beyond the grain market to the seafood market. The decline in anchovy catches, used as feed for farmed fish in Peru and Chile, is a key factor. Anchovies are a primary ingredient in feed for aquaculture, and reduced catches are expected to cause a sharp rise in feed prices. Typically, feed costs account for 60-70% of the expenses in raising farmed fish, so soaring feed prices lead to financial difficulties for aquaculture operators.

Impact of the Super El Ni?o

Experts analyze that the upward trend in food prices could steepen further. If the current El Ni?o phenomenon intensifies into a super El Ni?o, more severe weather anomalies are expected, and the ripple effects are likely to be passed on to food prices.

The Nihon Keizai Shimbun explained, "With global warming caused by human activity raising Earth's temperatures, the addition of a super El Ni?o greatly increases the likelihood of record-breaking heatwaves and heavy rains."

Meteorological agencies worldwide predict the arrival of a powerful super El Ni?o this summer, accompanied by heatwaves and heavy rains. A super El Ni?o refers to a phenomenon where sea surface temperatures remain more than 2 degrees Celsius above average for over three months. While El Ni?o is a natural phenomenon caused by 'winds' and unrelated to the climate crisis, when combined with global warming due to environmental pollution, it escalates into unprecedented heatwaves. When El Ni?o occurs, the amount of evaporated seawater increases sharply, causing heavy rains, and the rise in Earth's surface temperature raises the likelihood of heatwaves.

The super El Ni?o is expected not only to deepen inflation but also to cause enormous economic losses. According to the American scientific journal Science, the global economic loss from the super El Ni?o event between 1997 and 1998 reached approximately $5.7 trillion (7,212.78 trillion KRW). Such losses tend to concentrate more heavily on developing countries with fragile economies. The Nihon Keizai Shimbun emphasized, "Of the 2.4 billion people facing food crises as of last year, 1.1 billion reside in Asia and 868 million in Africa," adding, "It is necessary not only to respond to the sharp rise in food prices but also to implement long-term climate measures."

This content was produced with the assistance of AI translation services.