Food prices in many countries remain very high

by Editor
Thursday, July 23, 2009

Domestic food prices in developing countries remain high despite a sharp decline in international prices and overall good cereal harvests, FAO warned in its latest Crop Prospects and Food Situation report.

In several countries, prices exceed the already high levels of a year ago or are still at record levels, creating hardship for millions of people.

In sub-Saharan Africa 80 to 90% of all cereal prices monitored by FAO in 27 countries remain more than 25% higher than before the soaring food price crisis two years ago. In Asia and Latin America and the Caribbean prices are monitored in a total of 31 countries, and between 40 and 80% of these remain more than 25% higher than in the pre food-crisis period, according to FAO data.

In Eastern Africa, in Sudan, prices of sorghum in June were three times higher than two years ago. In Uganda, Kenya and Ethiopia prices of maize have doubled compared to two years ago. In Southern Africa, prices of maize have declined in recent months due to a bumper harvest but remain above the pre-crisis level. In Western Africa, prices decreased in late 2008 following good cereal harvests, but increased again in 2009. In Ghana, prices of maize in Accra have more than doubled since June 2007.

Among the reasons for high food prices, the report listed reduced harvests, higher or delayed imports, civil conflict, strong demand in neighbouring countries and regional trade flows, devaluation of national currencies, changes in food and trade policies, increased incomes and demand, and transport constraints and higher transport costs.
The outlook for world cereal supply and demand is satisfactory, despite an estimated 3% decline in world cereal production in 2009 from the 2008 record level, FAO said.

Despite a positive outlook for global cereal supplies, 30 countries around the world are in crisis and require assistance as a result of natural disasters, conflict or insecurity, and economic problems.