Globally food prices rise and closer to home retail giant announces price increases
Rome – The Food and Agriculture Organization (FAO) of the United Nations says global food prices increased for the eighth consecutive month in February.
The FAO says prices of all commodity groups it monitors are rising again, except for sugar.
Just as the FAO released its latest figures, Toronto-based George Weston Ltd. announced that it would be raising food prices by five per cent, reports Canadian Business.com.
George Weston attributes the increase to the rise in cost of staples such as wheat, sugar and vegetable oil.
The FAO says it expects the global cereal supply to tighten as well.
It adds that in the face of a growing demand and a decline in world cereal production in 2010, global cereal stocks this year are expected to fall sharply because of a decline in inventories of wheat and coarse grains. International cereal prices have increased sharply with export prices of major grains up at least 70 per cent from February last year.
Cereal supply and demand
The FAO says it expects winter crops in the northern hemisphere to be generally favourable and forecasts global wheat production to increase by around three per cent in 2011.This assumes a recovery in wheat production in major producing countries of the Commonwealth of Independent States. So far, conditions of winter crops in those countries are generally favourable.
The latest estimate for the world cereal production in 2010 is eight million tons – more than was anticipated in December but still slightly below 2009. This month’s upward revision reflects mostly higher estimates for production in Argentina, China and Ethiopia.
The forecast for world cereal use in 2010/2011 has been revised up by 18 million tons since December. The bulk of the revision reflects adjustments to the feed and industrial use of coarse grains. Larger use of maize for ethanol production in the U.S. and statistical adjustments to China’s historical (since 2006/2007) supply and demand balance for maize are the main reasons for the revision.