Inflation Rate for Food in Latin America

By Shubhendra Anand , 17 May, 2023

Food is the most significant contributor to inflation in Latin America and the Caribbean (LAC). In Venezuela, the inflation rate is high for the food of Latin America, as per the data by the Food and Agricultural Organization of the United States (FAO). Venezuela saw an increase of 110.4 percent in the inflation rate until September, and Argentina also saw the second highest rate, 86.8 percent.

According to FAO, the three countries with low food inflation rates for the same period are Bolivia at 2.2 percent, Panama at 5 percent, and Ecuador at 7.1 percent. Also, FAO said that the average annual food inflation in the region was 43.9 percent in September 2022, but it did not exceed 23 percent globally.

The LAC region is still experiencing socio-economic factors on a national basis which might be a reason leading the inflation to rise. The United Nations development program says the Russian- Ukraine war and the pandemic have contributed to the consequences of these overlapping crises affecting the societies in LAC.

According to FAO, lower-income households are more vulnerable to food inflation, most probably due to the disproportionate budget allocation towards the spending on food.