Food prices expected to decline
Global food prices, which were about 24% higher on average in 2011 than they were in 2010, are expected to decline in 2012 on increasing supplies although they still remain volatile, according to the World Bank.
"Prospects for decline in 2012 food prices remain favorable, due to weaker consumer demand as a result of a sluggish global economy, expected declines in the price of energy and crude oil, and strong forecasts for 2012 food supplies," the World Bank said in its "Food Price Watch" report issued Jan. 31.
An encouraging sign for 2012 prospects was an 8% decline in global food prices during September-December 2011, the World Bank said.
"The worst food price increases may be over but we must remain vigilant," said Otaviano Canuto, vice-president for poverty reduction and economic management at the World Bank.
"Prices of certain foods remain dangerously high in many countries, leaving millions of people at risk of malnutrition and hunger. Governments must step up to the plate and implement policies to help people cope."
Among the factors that may cause upward price pressure in 2012 are a possible increase in demand for biofuels, low stocks-to-use levels for maize, volatility in oil prices as a result of unrest in producer countries and weather changes, the World Bank said.
