Surging wheat prices push staple products out of reach of poor – UN agency
International wheat prices have hit record highs during the past three months, pushing the domestic price of bread and other basic foods in poor countries beyond the reach of many locals, the United Nations Food and Agriculture Organization (FAO) announced today.
The latest issue of the FAO Crop Prospects and Food Situation report, released at the agency’s headquarters in Rome, found that wheat prices have risen sharply since June because of tightening global supplies, historically low levels of stocks and sustained demand.
Maize prices have also jumped, despite this year’s bumper crop in North, Central and South America, because of continuing strong demand from the biofuels industry.
Paul Racionzer of the FAO’s Global Information and Early Warning System warned that cereal stocks, especially of wheat, are likely to remain at historically low levels for the foreseeable future. Wheat stocks are close to their lowest levels in 25 years.
“On current indications, this year’s cereal harvest would only just meet expected utilization levels in the coming year, which means that stocks will not be replenished,” he said.
The higher export prices for wheat – and other cereal crops – and surging freight rates have forced the price of bread and other products beyond the means of many people in the States classified as low-income food-deficit countries (LIFDCs), leading to social unrest in some areas.
The total cereal import bill for LIFDCs is forecast to hit an all-time high of $28 billion in 2007-08, a rise of 14 per cent on last year’s figures. In total, developing countries are likely to spend $52 billion on cereal imports.