Global food prices rose 1 per cent in March, the United Nations' food agency said on Thursday, pointing to a surge in dairy costs, while cereals prices were little changed and seen facing downward pressure in coming months.
The Food and Agriculture Organisation's (FAO) price index, which measures monthly price changes for a basket of cereals, oilseeds, dairy, meat and sugar, averaged 212.4 points in March, up 1 per cent from 210.7 in February and its highest since October 2012.
"All the dynamic this month comes from the dairy," said FAO senior economist Concepcion Calpe. "In general the situation is relatively calm."
FAO's dairy price sub-index jumped 22 points in March to 225.3, one of its largest changes ever recorded. The rise was fuelled mainly by prolonged hot, dry weather in Oceania which has hit pastures and led to milk production falling off steeply.
The organisation's dairy index is based on New Zealand spot prices, which it said have surged as buyers bid against each other to meet commitments.
Cereals prices on the other hand were little changed, and Calpe said they could see declines in coming months due to an expected recovery in output.
"We are optimistic for the coming crops. The previous year was particularly bad so barring something dramatic the direction should be upwards for production," she said. "If this is what happens we could see prices trending downwards."
Grain prices, which touched record highs late last summer, have been under pressure recently as acreage dedicated to crops has increased, reserves look fatter than previously thought, and livestock producers have cut herd sizes due to high feed costs.
The Rome-based agency raised its estimate of world cereal output in 2012 to 2.309 billion tonnes, up 3 million tonnes from a forecast made in March.
It maintained its forecast for world wheat production in 2013 at 690m tonnes, up 4.4 per cent from last year.
It expected world cereal stocks at the close of seasons ending in 2013 to approach 500m tonnes.
The FAO's index is below a record peak of 237.9 points hit in February 2011, when high food prices helped drive the Arab Spring uprisings in the Middle East and North Africa.
Over the summer last year, a historic US drought and dryness in Eastern Europe fuelled the third spike in global food prices in four years, with the index reaching 215.7 points in September 2012.
* Reuters
Some of Darwish's last words
"They see their tomorrows slipping out of their reach. And though it seems to them that everything outside this reality is heaven, yet they do not want to go to that heaven. They stay, because they are afflicted with hope." - Mahmoud Darwish, to attendees of the Palestine Festival of Literature, 2008
His life in brief: Born in a village near Galilee, he lived in exile for most of his life and started writing poetry after high school. He was arrested several times by Israel for what were deemed to be inciteful poems. Most of his work focused on the love and yearning for his homeland, and he was regarded the Palestinian poet of resistance. Over the course of his life, he published more than 30 poetry collections and books of prose, with his work translated into more than 20 languages. Many of his poems were set to music by Arab composers, most significantly Marcel Khalife. Darwish died on August 9, 2008 after undergoing heart surgery in the United States. He was later buried in Ramallah where a shrine was erected in his honour.
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