According to the latest World Bank assessment, Sri Lanka ranks fifth among the 10 countries with the highest food price inflation in the world.

UPC News - August 23, 2022

In its food security update, the World Bank said trade policy action on food and fertilizers has increased since the start of the war in Ukraine. Faced with potential food shortages at the start of the COVID-19 pandemic, countries actively used trade policy to respond to domestic needs.

As of July, Sri Lanka is facing a significant shortfall in the domestic food supply.

In Sri Lanka, agricultural production has dropped from 40 percent to 50 percent due to a shortage of fertilizer, and a lack of foreign exchange to buy food imports.

“Lack of fertilizer and fuel (for land preparation, transportation and harvesting activities) is expected to limit food supplies. Some relief is coming from the first shipment of 44,000 tonnes of urea backed by Indian debt (and 21,000 tonnes coming soon). Indian rice demand has increased, with around 9.6 million tonnes shipped this year,” the assessment said.

Exporters, concerned that export restrictions will be imposed (as has been done for wheat), are moving quickly to open letters of credit and have signed contracts to export 1 million tonnes of rice from June to September 2022. . In addition, food price inflation reached 80 percent in Sri Lanka.

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