Global food prices rose in March for a third successive month, driven by gains in grains and vegetable oils, the United Nations' Food and Agriculture Organization said on Thursday, April 5 putting food inflation firmly back on the economic agenda, Reuters reported.
Food prices hit record highs in February 2011 and stoked protests connected to the Arab Spring wave of civil unrest in some north African and middle eastern countries. They then receded but started to grow again in January.
The index, which measures monthly price changes for a food basket of cereals, oilseeds, dairy, meat and sugar, averaged 215.9 points in March, up from a revised 215.4 points in February, FAO data showed.
Its Cereal Price Index averaged 227 points in March, up from February, with maize prices showing gains, supported by low inventories and a strong soybean market, the FAO said.
The FAO also confirmed its earlier forecast for world wheat output to fall 1.4 percent from last year's record crop to 690 million metric tons (760.59 million tons) in 2012.
High oil prices have fanned inflationary concerns since the start of this year. Consumer prices in the 17 nations sharing the euro were up 2.6 percent in March from a year ago, despite the region's stumbling economy. Energy prices affect the production of fertilizers as well as costs related to food distribution and farm machinery use.
A U.S. government report last week with lower than expected estimates of grain stocks and reduced soybean and wheat plantings, added to concerns about global grain supplies, driving a rally in U.S. and European grain futures.
But FAO said prices could fall in the second half of this year with new crops easing market tension and driving full-year average prices below the record levels of 2011.
