Global food prices near 3-year highs -World Bank

WASHINGTON, (Reuters) – Global food prices held near  three-year highs in July and stocks were low, piling on  pressure on the world’s poor, the World Bank said yesterday.

The World Bank Food Price index increased 33 percent in  July from a year-ago and stayed close to 2008 peak levels, with  large rises in the prices for maize, or corn, and sugar.

“Persistently high food prices and low food stocks indicate  that we’re still in the danger zone, with the most vulnerable  people the least able to cope,” said World Bank President  Robert Zoellick.

High food and energy prices have stoked inflation pressures  around the global, but the problem has been more acute in  developing nations.
Although food prices are moderating in most advanced  countries, uncertainties about the global economy and the  political situation in the Middle East and North Africa mean  oil prices likely will remain volatile, keeping inflation on  the radar.

While overall food supply has improved since April —  mainly because of good wheat harvests in the United States and  Europe and better maize yields in Argentina and Brazil —  global stocks remained “alarmingly” low, the World Bank said.

Global output of grains in 2011/12 is projected to be 3  percent higher than the estimated output for 2010/11.

But the stocks-to-use ratio for maize currently stands at  about 13 percent, the smallest since the early 1970s. Wheat and  rice stocks also remain well below their late 1990s and early  2000 levels.

“Coupled with the fact that the realization of the forecast  yields is itself contingent on benign weather conditions in the  major exporting countries, the low stock environment has  created a situation in which even small shortfalls in yields  can have amplified effects on prices,” the World Bank said.

The price of maize was up 84 percent in July from a year  ago and sugar increased 62 percent.

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