World food prices hold steady at high

2013 was the third highest year on record for the FAO Food Price Index

sugar stored in a warehouse in Limera, São Paulo, Brazil.

2014 january 9, Rome-The FAO Food Price Index averaged 206.7 points in December, essentially unchanged from the previous month, as a sharp rise in dairy prices and higher meat prices offset a sharp drop in sugar prices and a decline in cereal and vegetable oil prices.

The full-year 2013 index averaged 209.9 points-down 1.6 per cent from 2012 and well below the 2011 peak of 230.1 points, but still the third highest annual value ever (see sidebar).

Adequate supplies have pulled down international prices for cereals (except rice), fats and confectionery. However, dairy prices peaked in 2013, and meat also set records.

"The FAO Food Price Index remained high last month as still-strong demand for certain high-protein foods pushed up overall prices, offsetting the decline in the prices of major food crops after the previous year's bumper harvest," said FAO economist Abdolreza Abbashian.

The FAO Food Price Index is a trade-weighted index that measures the prices of five major food commodities in international markets: cereals, dairy products, meat, sugar and vegetable oils.

The bumper harvest caused grain and sugar prices to fall.

The FAO Cereal Price Index averaged 191.5 points in December, 2.8 points lower than in November and the lowest monthly reading since August 2010. After a record harvest in 2013, plentiful global supplies continued to put downward pressure on international prices for wheat and, in particular, maize. In contrast, rice prices rose slightly in December.

Throughout 2013, the Cereal Price Index averaged 219.2 points, down as much as 17 points, or 7.2 percent, from 2012.

The FAO Sugar Price Index averaged 234.9 points in December, a sharp decline of 15.8 points from its level in November. It was the third consecutive month of decline as the sugar cane harvest in Brazil, the world's largest sugar producer and exporter, exceeded expectations. Reports of record production in Thailand, the world's second-largest sugar exporter, and a good harvest in China have further added to the downward pressure on international prices.

Overall, sugar prices were 18% lower in 2013 than in 2012.

Dairy and meat prices hit record highs

on the other hand, dairy prices rose in December and 2013 for the whole year.

The FAO Dairy Price Index averaged 264.6 points in December, up 13.2 points from November. Demand for milk powder, especially in China, remains strong, causing processors in the southern hemisphere to focus production on milk powder rather than butter and cheese products.

During 2013, the average dairy product index was 243 points, the highest annual value since statistics.

The FAO Meat Price Index averaged 188.1 points in December, slightly above its November level. Rising beef and pork prices: Beef prices have continued to rise since June last year due to strong demand in China and Japan. Poultry prices were more stable, while mutton prices were lower. Nevertheless, the index has remained at historically high levels in 2013, well above its pre-2011 levels.

Vegetable oil prices fall

the FAO Vegetable Oil Price Index averaged 196 points in December, down 2.5 points from November.

Throughout 2013, the index averaged 193 points-well below the average of 224 points in 2012, in which palm oil fell to a four-year low.

http://www.fao.org/news/story/zh/item/212085/icode/

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