Food prices remain high in developing countries

Food prices are still at high level in developing countries despite an improved global cereal supply situation and a sharp decline in international food prices, UN Food and Agriculture Organization (FAO) said in its latest Crop Prospects and Food Situation report published here on Thursday.
This is creating further hardship for millions of poor people already suffering from hunger and undernourishment, the Rome-based organization said.
This year’s world cereal production is forecast to decline by 3percent from the 2008 record, but it would still be the second largest crop ever, according to FAO’s first 2009 forecast.
Most of the decrease is expected to be in wheat, mainly due to a significant reduction in plantings in developed countries in response to lower international prices. In developing countries, cereal output could remain close to last year’s good level.
Food emergencies persist in 32 countries, despite good 2008 cereal crops in many of the countries normally most at risk of food insecurity, the report said.
Cereal prices in developing countries remain generally very high — in some cases at record levels, FAO said. Worst affected are the urban poor and food-deficit farmers who are dependent on the market to access food.
Moreover, the global economic recession is drying up remittances from family members working abroad that often sustain the food consumption levels of vulnerable households.
An analysis of domestic food prices for 58 developing countries shows that in around 80 percent of the cases, food prices are higher than 12 months ago, and in around 40 percent of the cases, the prices are higher than three months ago. In 17 percent of the cases, the latest price quotations are the highest on record.
The situation is most dramatic in sub-Saharan Africa. Domestic prices of rice are much higher than 12 months earlier in all countries analyzed, while prices of maize, millet and sorghum are higher in 89 percent of the countries in the region compared to a year earlier.
Food prices remain at high levels in other regions as well, particularly in Asia for rice and in Central and South America formaize and wheat, the FAO said.