Growing divide: Agricultural climate policies affect food prices differently in poor and wealthy countries

Farmers are receiving less of what consumers spend on food, as modern food systems increasingly direct costs toward value-added components like processing, transport, and marketing. A new study by the Potsdam Institute for Climate Impact Research PIK shows that this effect shapes how food prices respond to agricultural climate policies: While value-added components buffer consumer price changes in wealthier countries, low-income countries—where farming costs dominate—face greater challenges in managing food price increases due to climate policies.