The global food prices have dropped sharply to four per cent in May as a result of the generally favourable supplies and strengthening of the United States (US) dollar.
The May edition of the United Nations Food and Agriculture Organisaiton Food (FAO) Price Index shows a sharp drop in international prices of food commodities by four per cent.
FAO informed NaijaAgroNet in a press statement that May food prices dropped to 204 points from 213, which is, 9 points down from April and the lowest level since September 2011; about 14 per cent below its peak in February 2011.
Abdolreza Abbassian, a grain analyst at FAO said crop prices have come down sharply from their peak level but still remain high and vulnerable due to risks related to weather conditions in the critical growing months ahead.
FAO's latest forecast for world cereal production in 2012 stands at a record level of 2.4 billion tonnes, 3.2 per cent higher than 2011 record.
A higher percentage of the increase, NaijaAgroNet gathered is expected to originate mainly from maize in the United States amid an early start of the planting season and prevailing favourable growing conditions.
However, with planting still to be completed and much of the crop at very early stages of development, the final outcome will depend greatly on weather conditions in the coming months.
The forecast of global rice production in 2012 is firmer and points to a 2.2 percent increase from 2011, to some 490 million tonnes, mostly reflecting larger plantings in Asia.
For wheat, latest indications point to a contraction of about 3 per cent in production in 2012, to 680 million tonnes, still well above the average of the past five years.
The global cereal utilization is predicted to expand by at least two per cent in 2012-2013 season; to 2 376 million tonnes, with feed utilization growing by 3.8 per cent, while food consumption is expected to increase by just over 1 per cent, thereby largely keeping pace with world population growth.Yinka Awosanya/LS
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