Food Prices Expected to Rise Again
May 10/Kampala, Uganda/The Daily Monitor -- World food prices are set to rise again, as concerns persist over Chinese and U.S. winter crops and global production slows increasing demand, the U.N.’s Food and Agriculture Organization has warned.
The U.N. agency also said the world’s population is growing faster than expected and predicts it will hit seven billion by the end of this year, warning that the population could triple by the end of this century, exacerbating problems of access to food and clean water especially in Africa.
Persistent drought, high fuel prices and unemployment have contributed to the recent global food crisis, sparking off protests in east Africa and the Middle East states.
Hania Zlotnik, director of the population division in the U.N. department of economic and social affairs, said the rate of the world’s population growth has the U.N.’s attention.
“What is astounding is that the last two billion have been reached in record time,” Zlotnik said, adding that it is not about how many people there are but where they are.
“What is important is that most of these people are being added in the poorest countries of the world.”
The poorest countries, according to U.N., have the highest fertility rates, driving the world population upward. Australia has also been singled out for blame over its failure to fund family planning projects in the country.
FAO Director General Jacques Diouf says the rising output of biofuels is also contributing to food shortages, consuming more than 100 million tons a year of cereals that would otherwise be used in food production.
FAO’s global food index fell in March after eight months of consecutive gains, driven by political unrest across parts of North Africa and the Middle East and the earthquake and tsunami in Japan, the major importers of grain. However, Diouf said this trend had already begun to reverse.
“The fundamentals of supply and demand are still there,” he said. “There are concerns about the winter crops in China and in the United States. In addition, demand has started increasing in Japan and in the Arab world.”
Diouf said the extent to which food prices will rise will depend on the dollar’s value and world oil prices, currently exacerbated by climate change, droughts and floods.
He said the world is moving toward high prices because of lack of investment in agriculture over the past decade. In the earlier report, the FAO forecast wheat production for this year at 676 million tons, up 3.4% from 2010, because of increased planting in many countries in response to high prices, and yield recoveries expected in drought affected areas.
The global output forecast for 2011, however, would still be below the bumper harvests in 2008 and 2009.
In the European Union, the overall wheat planted area is expected to be up by about 2%, and with generally satisfactory conditions so far, the aggregate 2011 output is tentatively forecast to increase by 4%.
In the Russian Federation, the winter wheat area was reduced because of dry conditions, but the decline is expected to be more offset by increased spring plantings.
Coupled with an expected yield recovery after last year’s drought, a sizeable increase in the country’s 2011 wheat production over 2010 is expected. In Ukraine and North America, the wheat production is expected to remain constant.
From the May 11, 2011, Prepared Foods' Daily News.