Food prices hit record high

The United Nation’s Food and Agriculture Organization’s (FAO) Food Price Index hit a new record high in February, driven mostly by higher prices of cereals, meat and dairy products, the agency said on March 2.

The index rose for the eighth consecutive month, averaging 236 points in February, up 2.2 per cent from January and the highest since January 1990, when the index started.

With the exception of sugar, prices of all other commodity groups monitored registered gains in February. Dairy products and cereals climbed the most. The cereal price index averaged 254 points in February, up 3.7 per cent from January and the highest since July 2008.

The oils/fats index rose marginally to 279 points in February, standing just below the peak recorded in June 2008. By contrast, FAO sugar price index averaged 418 points, slightly below the previous month but still 16% higher than this time last year.

International prices of wheat rose by 7 per cent in February. The benchmark U.S. wheat price averaged $362 per tonne, 75% higher than a year earlier but still 25 per cent below its peak in March 2008. Wheat markets came under downward pressure later in the month following some improvements in weather in China and reports of possible delays in purchases by some of the countries hit by the recent wave of political unrest.