World food prices surge for third month to 5-year high in December: UN FAO

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World food prices surged for the third consecutive month to reach a five-year high in December, lifted by strong rises in vegetable oils, sugar and dairy as well as rebounding cereal prices, the United Nations food agency said on Thursday.

The Food and Agriculture Organization (FAO) food price index, which measures monthly changes for a basket of cereals, oilseeds, dairy products, meat and sugar jumped to its highest point since Dec. 2014, averaging 181.7 points, up 2.5% on the previous month.

For the year as a whole, the index averaged 171.5 points, 1.8% higher than in 2018 but below the peak of 230 points reached in 2011.

The cereal price index rose 1.4% to average 164.3 points, led by higher prices for wheat with stronger demand from China and logistics problems following strikes in France. Rice prices were little changed.

Vegetable oil prices were up strongly, with the index rising 9.4% to 164.7 points in December. Palm oil prices rose for the fifth month in a row, lifted by biodiesel demand, while soy, sunflower and rapeseed oil values also increased.

The dairy price index averaged 198.9 points in December, up 3.3% with higher cheese and skim milk powder prices that outweighed lower butter and whole milk powder values.

The sugar price index was up 4.8% to 190.3 points, lifted by surging demand for ethanol caused by rising crude oil prices.

By contrast meat prices were almost unchanged from November with the meat price index at 191.6 points with higher pig and sheep meat prices balanced by falling beef prices.