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Global Food Prices Rise in July in Aftermath of Severe Droughts

11 Aug

Global food prices rose in July in the aftermath of severe droughts in the US, Southern Europe India and Australia.

On Thursday the UN agency, the Food and Agricultural Organization reported, that the FAO Food Price Index climbed 6% in July 2012 after three months of decline.

The Index, which measures  the monthly change in the international prices of a basket of food commodities, averaged 213 points, up 12 points from June. That was still well below the peak of 238 points reached in February 2011, however.

The Index’s sharp rebound was mostly driven by a surge in grain and sugar prices. International prices of meat and dairy products were little changed. 

The FAO Cereal Price Index averaged 260 points in July, up 17%, or 38 points, from June. That was 14 points below its all-time high of 274 points in April 2008.

The severe deterioration of maize crop prospects in the United States following extensive drought damage pushed up maize prices by almost 23% in July.

International wheat quotations also surged 19% amid worsened production prospects in the Russian Federation and expectations of firm demand for wheat as feed because of tight maize supplies.

However international rice prices remained mostly unchanged in July, with the FAO overall Rice Price index stable at 238, barely one point above June.

July also saw a sharp increase in the FAO Sugar Price Index, which leaped 12%, or 34 points, from June to a new level of 324 points.

The upturn, ending a steady fall since March, was triggered by untimely rains in Brazil, the world’s largest sugar exporter, which hampered sugarcane harvesting.

Concerns over India’s delayed monsoon and poor rains in Australia also contributed.

GLOBAL FOOD PRICE INDEX

GLOBAL FOOD PRICE INDEX

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Posted by on August 11, 2012 in International News

 

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