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Milan - The United Nations Food and Agriculture Organisation
(FAO) on Thursday announced a surprise rise in its global food price index
fuelled by higher sugar prices, and raised its grain output forecast to reflect
the latest US data.
The index, which measures monthly price changes for a food
basket of cereals, oilseeds, dairy, meat and sugar, averaged 234 points in
June, up from a revised 231 points in May and 39% higher than in June 2010, the
FAO said.
A drop in wheat, corn and soybean prices had been
expected to drag on the index and defuse price food inflation, one of the
factors which sparked unrest in Arab countries earlier in the year.
The FAO’s index hit a record high of 238 points in February
fuelled by climbing grain prices and tight supplies, raising fears of a repeat of the 2007/08 global food
crisis when soaring prices triggered deadly riots in some developing countries.
The FAO Sugar Price Index averaged 359 points in June, up
14% from May.
“The price strength reflects dynamic short-term demand (for
sugar) against tight exportable availabilities, notably in Brazil, the world’s
largest sugar producer where production is forecast to fall below last year’s
level,” the agency said.
The FAO Cereals Price Index, which includes prices of main
food staples such as wheat, rice and corn, fell 1% from May to an average of
259 points in June, it said.
The FAO raised its forecast for world cereal output in 2011/2012 to about 2.313 billion tonnes, 11 million tonnes above its last forecast released on June 22 and 3.3% higher than last year’s output, following two consecutive revisions to US crop and planting prospects for 2011.
