Global food prices increased for the eighth consecutive month in February, with prices of all commodity groups monitored rising again, except for sugar, FAO said today.The picture at top shows the history of the FAO index since 1990, showing that, in real terms, we are now way above the peak of the 2008 food price shock. (Although, if the index went back longer, it would show that food prices used to be much higher than they are even now).
FAO expects a tightening of the global cereal supply and demand balance in 2010/11. 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 percent from February last year.
"Unexpected oil price spikes could further exacerbate an already precarious situation in food markets," said David Hallam, Director of FAO's Trade and Market Division.
Here's the breakout by commodity group recently:
I guess the good news is that the pace of increase does seem to have moderated in the most recent month's data.