World food prices stabilized in August at levels close to those reached in the food crisis of 2008, but global grain stocks are likely to shrink this year as cereal crop output falls short of what is needed, says the United Nations food agency.
The FAO Food Price Index, which measures monthly price changes for a food basket of cereals, oilseeds, dairy, meat and sugar, averaged 213 points in August, unchanged from July, when prices surged six per cent.
The index is below a peak of 238 points hit in February 2011, when high food prices helped drive the Arab Spring uprisings. But it is still close to levels during the food price crisis in 2008.
“Although we should remain vigilant, current prices do not justify talk of a world food crisis. But the international community can and should move to calm markets further,” said FAO director general Jose Graziano da Silva.
“We are reassured that the drought problems in the U.S. will not pull us into a similar situation that we had in 2008.”
The agency says there are still upside risks for food prices, such as the potential for speculative capital to return to markets.