Global food prices are expected to rebound in the next few weeks after coming off record highs in March as demand keeps growing against tight supplies, a top official at the United Nations’ food agency said on April 7.
“We believe that in the next few weeks, and there are already signs of it, prices will rebound,” Concepcion Calpe, senior economist at the UN’s Food and Agriculture Organization told Reuters in a telephone interview.
The FAO’s global food index fell in March after eight months of consecutive gains, driven by external factors such as political unrest in North Africa and the Middle East and a natural disaster in Japan, all major grain importers, the FAO said.
“From the point of view of fundamentals, the demand is very strong and the production prospects are not so rosy as expected earlier in the season,” Calpe said.
Strong grain demand is driven by a combination of food, feed and biofuels demand, while stocks have been dwindling, she said.
Soaring oil prices will also push food prices higher as they increase cost of food products and fuel demand for biofuels, which in turn adds to food costs, she said.