Many crops – including cereal crops – are on target for record production, but prices will stay highGlobal food prices will remain high and volatile throughout this year and into next despite record food production.
The United Nations Food and Agriculture Organisation (FAO) twice yearly Food Outlook analysis says rising demand will absorb most of the higher output.
It says its index of food prices in May was at 232, only six points below February’s record high of 237.
The FAO says higher food prices could mean poor countries will see food import costs rise by up to 30%.
That would mean them spending 18% of their total import bills on food this year, compared with the world average of 7%.
The organisation says the next few months will be critical in determining how major crops will fare this year.
Tight situationThe FAO’s May index – which measures price changes in a range of essential foodstuffs, including cereals, oilseeds, dairy, meat and sugar – was 37% higher than a year ago.
David Hallam, director of the FAO’s markets and trade division, said: “The general situation for agricultural crops and commodities is tight, with world prices at stubbornly high levels, posing a threat to many low-income food deficit countries.”
The FAO says although prospects are encouraging in some countries, such as Russia and Ukraine, weather conditions – either too much or too little rain – could hamper wheat and maize production in Europe and North America.
In 2010, drought led Russia to ban exports of cereals and Ukraine to limit overseas sales. Better weather there this year means exports should return to normal and globally cereal production is expected to rise to a record.
Record production is also expected this year for other staples, including rice and fish. – BBC
