Mexicos Food Production Costs Rise Amid Global Economic Pressures

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Prices of staples such as tomatoes, potatoes, beef, and chillies have increased significantly at a wholesale food market in Nuevo Leon, Mexico, over the past few weeks. The rise in prices has forced customers to adjust their shopping habits and reduce their spending.

According to vendors, rising fuel costs are contributing to the price hikes. Additionally, high costs in the agricultural sector and growing extortion and theft on Mexico’s highways are also cited as factors.

International pressures are also affecting Mexican producers, with global costs of fuel and fertiliser driven by shipping disruptions in the Strait of Hormuz impacting production and threatening a stable food supply. Low-income households spend nearly 70 percent of their earnings on food, making them particularly vulnerable to price increases.

Data from INEGI shows that 12-month inflation stood at 4.45 percent in April, with the consumer price index rising 0.20 percent in March. The cost of the basic food basket in urban areas rose 8.1 percent in March, outpacing general inflation.

Some households are taking measures to cope with the increased prices. A 62-year-old housewife has begun rationing her shopping and visiting a wholesale market to buy only essential items. Others are facing financial strain due to rising energy costs driven by the US-Israel war on Iran.

The Mexican Meat Council reports that beef prices rose by 16.5 percent in January, attributed to factors such as the end of tariff exemptions on imports from Brazil and Argentina, as well as a screwworm outbreak disrupting cross-border trade.

Source: Al Jazeera