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FAO Records Increase in World Food Commodity Prices

5 April 2014 06:16 WIB

Bahan Pangan Catat Deflasi 0,62 Persen

TEMPO.CO, Jakarta - The Food and Agriculture Organization's (FAO) price index, which measures monthly price changes for cereals, oilseeds, dairy, meat and sugar, averaged 212.8 points in March 2014, up by 4.8 points or 2.3 percent from February 2014. The reading was the highest since May 2013. FAO stated that the increase in global food prices was caused by unfavorable weather for crops and political tensions engulfing Ukraine.


"Political tensions of the sort we see today have the risk of taking us back to a Cold War situation, where countries make purchases of grain not only based on price differences offered but also because of political alliances," FAO economist Abdolreza Abbassian said.


On March 2014, FAO's cereal price index rose for the second consecutive month, jumping 5.2 percent to its highest since August 2013. The increase was due to unfavorable weather in the south-central United States and Brazil, along with uncertain grain shipments from Ukraine.


The sugar price index also experience the highest increase of 7.9 percent on the previous month as a result of drought in Brazil and reduced sugarcane output in Thailand. FAO then increased its global cereals production forecasts to 2.521 billion metric tons in 2013, six million metric tons higher compared to its previous forecasts.


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