Food prices expected to carry on increasing

Food prices will most likely continue to rise next year, according to a UN report.

Costs have ‘risen alarmingly’ in the last 12 months and remain turbulent, the UN’s Food and Agriculture Organisation said.

Bread and meat have seen a huge increase in price and the supply of wheat, other cereals and sugar is also likely to fall.

The Food Outlook report also said international food import bills could top the $1trillion dollar mark by the end of this year.

The report said: ‘With the pressure on world prices of most commodities not abating, the international community must remain vigilant against further supply shocks in 2011 and be prepared.’

It said ‘world prices have risen alarmingly and at a much faster pace than in 2007/8.’

Wheat prices shot up sharply in August when Russia imposed a wheat export ban after severe drought hurt harvests across the region.

Last month, the Ukraine also imposed quotas on exports because of the drought.

The UN report said production needed to increase in wheat, maize and soybean to avert further increases but predicted that cereal production would shrink by two per cent next year.

The latest forecast for 2010 wheat production stands at 648million tons, 29million less than predicted in its June report.

In 2007 and 2008, poor harvests and high oil costs saw food costs soar and led to rights across the globe.

Extreme weather conditions, including droughts in major growing areas in Russia, have been blamed for fewer crops being produced, while City speculators have also played a part in pushing up prices.