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TURKIYE’S AGRICULTURAL PRODUCER INFLATION HITS NEW RECORD IN APRIL!

Turkiye’s producer price index for agricultural products (Agriculture-PPI) increased by 17.76% in April from the month before, according to official data Tuesday.

Year-over-year, the index surged 118.53%, the Turkish Statistical Institute (TurkStat) said.

On the sectoral basis, a 0.12% increase was seen in fish and other fishery products compared to the previous month, 18.10% in agricultural and hunting products and related services, and 21.03% in forestry products and related services.

There were 6.52%, 8.41% and 27.66% month-on-month increases in perennial herbal products, live animals and animal products, and annual vegetable products, respectively, in the main product groups, the data showed.

According to the annual Agriculture-PPI, seven subgroups showed a slow-increase trend, while four subgroups showed high-increase trends.

The subgroups with a low annual increase are citrus fruits with 21.82%, and sheep and goats and their unprocessed milk with 45.18%. On the other hand, the subgroups with the highest annual increase are fibrous plants with 295.72%, vegetables and melon-watermelons with 248.33%, and roots, tubers and cereals (excluding rice), legumes and oil seeds with 135.01%.

According to the monthly Agricultural-PPI, six subgroups showed lower changes and five subgroups showed higher changes.

The subgroups where the increase was lower compared to the previous month were citrus fruits with 4.95% and other farm animals and animal products with 5.60%, respectively. The subgroups in which the monthly increase was high were tree and shrub fruits and hard-shelled fruits with 61.29%, and vegetables and melon-watermelons, roots and tubers with 42.69%.

The only subgroup that showed a decrease compared to the previous month was live poultry and eggs with 0.11%.

In April 2022, out of 77 items included in the index, the average price of 14 items decreased, while the average price of 12 items remained unchanged. The average price of 51 items increased.

Food inflation makes it hard for millions of people in developing and emerging market countries around the world to shop for stable foods.

Global food prices have climbed for two years, fueled by COVID-19 disruptions and weather woes. Supply shocks to grains and oils from Russia’s invasion of Ukraine saw them hit an all-time record in February, and again in March.

Inflation rates have soared, with energy price rises adding to pressure. Turkey or Argentina with annual inflation of 70% and around 60% might be outliers, but readings are into double-digits in countries from Brazil to Hungary. It makes U.S. inflation at 8.3% look modest in comparison.

And with the war in Ukraine not only disrupting food but also fertilizer supplies, food inflation could be longer-lasting, Marcelo Carvalho, head of global emerging markets research at BNP Paribas told Reuters.

“This is here to stay,” said Carvalho. “Food is very salient – when there is a change in food prices, the perception about inflation is magnified – those feed into inflation expectations that are more easily unanchored.”

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About İsmail Uğural

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