Inflated food prices could be set to continue due to increased demand and higher production costs from developing countries, according to the UN Food & Agricultuere Organisation (FAO).
Stating that food is “no longer the cheap commodity that it once was”, the FAO, in its Outlook report for May 2008, cited the growing demand for biofuel and weather-damaged crops as factors driving global food prices upwards.
According to its annual report, beef and pork prices could be 20% higher by 2017, with wheat predicted to jump 60% in price and vegetable oil potentially rising by 80%.
The cost of meat has been fuelled by the depreciating US dollar and higher feed costs, with ovine prices alone increasing by 17% over 2008’s first quarter. Meat prices are expected to remain under pressure as the cost of cattle feed continues to rise.
Although the report predicts developing countries to dominate the production and consumption of most commodities by 2017, with the exception of coarse grains, cheese and skim-milk powder, farmers in developing countries will “draw little or no benefit,” from increased prices.IFAonline
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