World food prices exceed levels that sparked deadly riots in 2008

WORLD food prices rose to a record in December on higher sugar and meat costs, the United Nations said, exceeding levels reached in 2008 that sparked deadly riots from Haiti to Egypt.

An index of 55 food commodities maintained by the Food and Agriculture Organisation climbed for a sixth month to 214.7 points, above the previous all-time high of 213.5 set in June 2008, according to a monthly report on the UN agency’s website. The gauges for sugar and meat prices advanced to records.

Sugar climbed for a third year in a row in 2010, and corn jumped the most in four years in Chicago. Food prices may gain further unless global grain production rises “significantly” in 2011, the FAO said November 17. At least 13 people died last year in Mozambique in protests against planned increases in bread and water prices.

“There is still, unfortunately, the potential for grain prices to strengthen on the back of a lot of uncertainty,” Abdolreza Abbassian, senior economist at the FAO, said.

“If anything goes wrong with the South American crop, there is plenty of room for them to increase further.”

The FAO’s food-price indicator climbed from 206 points in November. Its gauge for sugar prices reached 398.4 points last month, increasing from 373.4 in November. The meat-price index rose to 142.2 points from 141.5.

The agency’s cereal-price index jumped to 237.6 points in December, the highest level since August 2008, from 223.3 the previous month. The indicator for cooking oils advanced to 263 points, the highest since July 2008, from 243.3. The index for dairy prices rose to 208.4 points from 207.8.