February 6, 2012

World Bank warns of fluctuating food prices

The world has to stay alert in the face of high and unstable global food prices, according to the Washington-based World Bank Group.

Global food prices declined 8% between September and December of 2011 due to increasing supplies and uncertainty about the global economy, but still remained volatile and high with the 2011 annual index 24% higher than its average in 2010, the Bank said Tuesday (Jan 31) in a statement releasing its latest Food Price Watch report.

"While the first quarter of 2011 witnessed sharp increases, five consecutive months of decreases at the end of the year drove the World Bank Food Price Index 7% below the December 2010 levels, and 14% lower than its February peak. Nevertheless, global prices remain high with the 2011 annual index averaging at 210 points against 169 points average in 2010," said the statement of the Bank.

Despite the downward trend over the last few months, global prices of key staples continued experiencing volatility, and the average annual prices of wheat, corn and rice well exceeded averages for 2010, noted the quarterly Food Price Watch report.

"The worst food price increases may be over but we must remain vigilant," said Otaviano Canuto, the World Bank Group's Vice President for Poverty Reduction and Economic Management.

"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," Canuto added.