Record High Prices of Sugar, Grain

Prices of sugar, grain and oilseed have hit the roof and touched a record high, recent report reveals.

An index compiled monthly by the United Nations surpassed its previous monthly high - June 2008 - in December to reach the highest level since records began in 1990, The Guardian reports.

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Published by the Rome-based Food and Agriculture Organisation (FAO), the index tracks the prices of a basket of cereals, oilseeds, dairy, meat and sugar, and has risen for six consecutive months.

The FAO food index hit 215 points last month, up from 206 in November, to break the 213.5 registered in June 2008. It shows a dramatic rise in prices for food in a decade. In 2000 the index stood at 90 and did not break through 100 until 2004.

Abdolreza Abbassian, FAO economist, told the Guardian: "We are entering a danger territory."

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But he stressed that the situation was not yet as bad as 2008.

Sugar and meat prices are at record levels, while cereal prices are back at the levels last seen in 2008, when riots in Haiti killed four people and riots in Cameroon left 40 dead.

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Abbassian warned: "There is still room for prices to go up much higher, if for example the dry conditions in Argentina tend to become a drought, and if we start having problems with winterkill in the northern hemisphere for the wheat crops."

Abbassian said he now expects food prices to start to fall because many poorer countries had good harvests last year.

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He also said that the current floods in Australia have the potential to affect prices for commodities such as sugar.

Source-ANI