The increase in prices is largely fueled by the rise of dairy products, according to the UN Food Price Index (FPI) released April 11, 2013.
The Food and Agriculture Organisation (FAO) said there was 11% increase in dairy products which carried a 17% weight among the various commodity prices included in the calculation of the overall FPI.
According to the Rome-based UN food agency, the Dairy Price Index jumped by 22 points in March to 225, one of the largest recorded changes explaining that the price surge was caused by hot, dry weather in Oceania, which has led to milk production falling off steeply.
“The exceptional increase is in part a reflection of market uncertainty as buyers seek alternative sources of supply,” the Food Price Index report says.
On the other hand the FAO Cereal Price Index averaged 244 points, unchanged from February leading to stable global price of rice.
The Oils/Fats Price Index fell 2.5% from February and the FAO says was due mostly to soy oil prices, which dropped on account of favourable weather conditions in South America, a record 2013 US soybean crop and a cancellation of purchases by China. Palm oil prices were also slightly down.
Meat prices went down 2% from February, according to the FAO as it averaged nearly 176 points in March.
The FAO Sugar Price Index edged higher 2.8 points, or one percent, from February, the agency indicated.
By Ekow Quandzie