Global food prices dropped for the fourth month in a row in August, reaching its lowest level since June 2012, according to the UN Food and Agriculture Organisation (FAO).
FAO in a statement on Thursday said that the drop in prices was driven by continued declines in prices of cereals and oils, as well as a forecast bumper harvest for this fall.
In its Food Price Index, which measures monthly changes in international prices of a basket of meat, dairy, cereals, oils and fats, and sugar, the agency stated that the prices dropped nearly four points to 201.8 last month, down 5.1 per cent from August of last year.
It also said that its Cereal Price Index averaged 210.9 points, down 16.4 points from July and 49.4 points from August 2012.
According to FAO, there was a steep decline in cereal prices which reflects expectations for a strong growth in world cereal production this year and, especially, a sharp recovery in maize supplies.
FAO also said that the production of cereal, rice and maize is expected to increase in 2013.
However, it noted that dairy, meat and sugar prices rose slightly.
It also disclosed that world rice production is set to increase by 1.3 per cent, reaching a new high of 497 million tonnes, in milled equivalent.
The FAO also said that the boosts had led to a revised forecast of overall world cereal production upwards 14 million tonnes to 2,492 million tonnes.
‘This would be 179 million tonnes higher than in 2012 and a new record,’ it added.
The Rome-based agency said that based on the latest forecasts, total use of cereals for direct human consumption was set to expand by 1.2 per cent to 1,094 million tones.