Hike noted in world food prices - the first in 6 months
However, this level is still 7% lower than in January last year.
Prices of all the commodity groups in the index registered gains last month. Oils increased the most, followed closely by cereals, sugar, dairy products and meat.
Weather worries
Prices mostly reflected worries about weather conditions affecting 2012 crops in several major producing regions, with key growing regions in South America and Europe hit.
“There is no single narrative behind the food price rebound – different factors are at play in each of the commodity groups,” said senior grains economist Abdolreza Abbassian, who notes a lack of involvement in the price hike of the usual suspects - the dollar and oil.
“But the increase, despite an expected record harvest and an improved stocks situation, and after six months of falling or stable prices, highlights the unpredictability prevailing in global food markets,” he added.
International prices of all major cereals with the exception of rice rose, with maize gaining most, 6%. Wheat prices also gained, though less significantly.
Higher palm and soy oil demand
Firming import demand for palm and soy oils, combined with a seasonal decline in palm oil production were the main driving forces behind the increase in fats and oil prices.
The meat price index averaged 179 points, 0.5% (1 point) above its December value - prices of the various meat types followed mixed directions, with pig meat up 2.8% on expectations of strong imports by China and poultry down by 1%.
The dairy price index averaged 207 points in January 2012, up 2.5% from December. Meanwhile, the sugar price index rose to 334 points in January, up 2.3% from December, but was still 20% lower than in January last year, with the jump said to be largely driven by less than favourable weather conditions in Brazil, the world’s largest producer and exporter.
