World food prices are high, but steady

2013 was considered to be the third highest year on record for FAO Food Price Index. The index measures prices of five major food commodities on international markets: cereals, dairy products, meat, sugar, and vegetable oils.

The FAO Food Price Index averaged 206.7 points in December 2013, almost the same as in November, with a significant increase in dairy products prices and high meat values to balance the lower prices for sugar, cereal and oil.

For the entire last year, the index averaged 209.9 points, with 1.6 percent less than 2012, and well below 2011's top of 230.1, but still the third highest annual value on record.

Dairy prices met the highest growth in 2013 and meat hit a record, also. Prices for cereals went down because 2013 brought large supplies, except those of rice.

"Last month, the FAO Food Price Index remained elevated as strong demand for certain high-protein foods continued to drive up prices overall, countering falling prices of major food crops after last year's abundant harvests," said FAO economist Abdolreza Abbassian.

For 2013, the FAO Cereal Price Index averaged 219.2 points, with 7.2 percent lower than 2012. An average of 191.5 points was recorded in December, down with 2.8 points from previous month, and this was the lowest value registered since August 2010. Record harvests all over the world and large supplies affected the global prices of wheat and maize especially. On the other hand, rice prices were up slightly in the last month of 2013.

FAO's Sugar Price Index averaged 234.9 points in the last month of 2013, suffering a slide of 15.8 points from November. It was the third monthly decline, with the sugarcane harvest in Brazil - the world's largest sugar producer and exporter - exceeding expectations. Record productions were also reported in Thailand and China.

In 2013, global sugar price was 18 percent lower than in 2012.

As for dairy and meat, both hit a new record in 2013.

The FAO Dairy Price Index averaged 264.6 points in December, a rise of 13.2 points over previous month. During 2013, the dairy index averaged 243 points - its highest annual value.

The FAO Meat Price Index averaged 188.1 points in December, slightly above its previous month level. Prices for bovine and pig meat moved up. Prices for poultry were stable, while those for sheep meat went down. Still, in 2013, the index remained record high.
The report recorded a drop in vegetable oil prices. Vegetable Oil Price Index averaged 196 points in December with a decrease of 2.5 points from November. For the last year as a whole, the index averaged 193 points - well below the 224 points average in 2012.