NewsApp (Free)

Read news as it happens
Download NewsApp

Available on  

Rediff News  All News  » Business » Global food prices to remain volatile

Global food prices to remain volatile

October 08, 2013 16:56 IST

Food prices are expected to remain volatile globally over the next few years and countries including India will have to adapt to the volatility, UN body Food and Agriculture Organization has said.

"International prices have declined but they are still above their historical levels. And prices are expected to remain volatile over the next years," FAO Director-General José Graziano da Silva warned at a ministerial meet on international food prices held in Rome on Monday.

The world’s food price problems are not over despite a current market lull, he said in an official statement.

Graziano da Silva further said that the two critical issues for countries to address are how to help poor small-scale farmers benefit from the higher food prices, and how to protect low-income families who suffer as a result of them.

"The current situation offers an opportunity for farmers to reinvest in agriculture," he said, calling for a right set of policies to ensure that small-scale farmers have the means to take advantage of it.

He said low-income families must be shielded by strengthening social protection programmes, including cash transfers to extremely poor households, and creating new ways to link social protection and support for agricultural production.

Stating that the outlook for international food commodity markets finally looks calmer this year, the FAO chief said: "Grain production has rebounded and higher stock-to-use ratios should bring greater stability to prices. The FAO Cereal Price Index is 20 per cent lower than one."

Although prices have stabilised, he cautioned against dropping the guard.

He also underscored that while lower food prices brought relief to poor consumers, higher prices were not necessarily all bad news as they came after three decades of stagnant prices that negatively affected the agricultural sector in many poor countries.

He urged countries to take advantage of the comparative calm to prepare for future market turbulence and find lasting solutions to the issues surrounding food price volatility.

According to the FAO, the improved global governance has played an important role in warding off additional food price spikes since July 2012.

In particular, the Agricultural Market Information System (AMIS) created by the G20 in 2011 has proved an effective new weapon in the arsenal to fight against excessive price volatility, providing reliable information and increasing transparency in the international food market, it added.

© Copyright 2017 PTI. All rights reserved. Republication or redistribution of PTI content, including by framing or similar means, is expressly prohibited without the prior written consent.