July 8, 2011
Hard-pressed consumers face higher grocery bills after new figures showed that food prices jumped by 1.3% in June to within a whisker of their record high.
The United Nations Food and Agriculture Organisation (FAO) food price index increased by 3 points to 234 points last month – a 39% increase on the year – as concerns about weak Brazilian sugar production sent sugar prices soaring by 14%, outweighing a decline in cereal costs.
As analysts at Goldman Sachs predicted that commodity prices would continue rising into next year, the average food price is now only 1.6% below February’s record, when the FAO’s basket of 55 food commodities reached 238 points.
Brazil is by far the biggest sugar producer in the world, accounting for more than half of world trade. In recent weeks poor weather has prompted analysts to reduce the amount of sugar they expect Brazil to harvest this year by 40m tonnes to 535m – the same as last year.
This article was posted: Friday, July 8, 2011 at 3:30 am