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Global food prices hit 4-year low

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Global food prices hit a four-year low as of August 2014, driven mainly by sharp decreases in the price of wheat and maize, according to the Food Price Watch.

The September issue of the regular report of the World Bank on the global food price movements said international food prices decreased by 6.0 percent between April and August 2014, fully reversing increases in the previous January-April quarter of this year.

The report recorded that the food prices in August were around 6.0 percent lower than a year ago and 21 percent lower than their all-time peak in August 2012.

“In fact, prices are at a four-year low, with similar levels not seen since September 2010,” the report said.

During April-August 2014 quarter, wheat price went down by 19 percent and maize decreased by 21 percent, pulling the overall price of food to a four-year low. Oil price also declined by 12 percent during the period. Such monthly price decreases had not been seen since October 2011.

Prices of soybean and sugar also declined by 32 percent and 18 percent respectively at the end of August on year-on-year basis, the report said.

Rice price showed a contrasting trend with 13 percent increase during the same period. According to the report, rice price in August rose by 13 percent compared to the price in April. However, rice became cheaper by 7 percent from August 2013 and 22 percent from August 2012.

The report said that the decision of the government of Thailand to suspend sales of rice from public reserves in June tightened availability and international prices, since exporters have more limited access to those reserves.

In addition, India is reported to be releasing 5 million tons of rice from its public reserves into the local market over the next months to control food price inflation.

The report also forecasts that rice production for 2014 would reach a new record high.

Apart from the rice price increase, the declining trend in other food-grains raises the prospects for next year’s strong food stocks.

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