Global food prices drop

June 8th, 2012 - 12:43 pm ICT by IANS  

Rome, June 8 (IANS) Global food prices dropped sharply in May, the Food and Agriculture Organization’s (FAO) Food Price Index showed.

The index, which measures the monthly change in international prices of a basket of food commodities, averaged 204 points in May, nine points down from April. It was the lowest level since September 2011 and was about 14 percent below its peak in February 2011, the FAO said Thursday.

Generally favourable supplies, growing global economic uncertainties and a strengthening of the US dollar are the main reasons for the price drop, reported Xinhua.

The UN organization at the same time raised the forecast for world cereal production in 2012 by 48.5 million tonnes, mainly on the expectation of a bumper maize crop in the US.

FAO’s latest forecast for world cereal production in 2012 stands at a record level of 2.41 billion tonnes, 3.2 percent up from the 2011 record.

The forecast of global rice production in 2012 points to a 2.2-percent increase from 2011, to some 490 million tonnes.

For wheat, latest indications point to a contraction of about 3 percent in production in 2012, to 680 million tonnes, which is still well above the average production of the past five years.

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