Farmers Weekly Interactive

Meat and milk production costs to feed food inflation

Food prices are forecast to reach record highs in 2013 and to continue rising through to late next year, predicts Rabobank. It estimates that the Food and Agricultural Organisation (FAO) Food Price Index will rise by 15% by the end of June 2013.
This will be the knock-on effect of high feed costs on meat and milk production around the world, with the bank predicting high grain and oilseeds prices for at least the next 12 months.
Unlike 2008 when the food price spike hit the world’s poorest hardest, the impact on the poorest consumers should be reduced this time around, as purchasers are able to switch consumption from animal protein back towards staple grains like rice and wheat, says the bank.
“These commodities are currently 30% cheaper than their 2008 peaks. Nonetheless, price rises are likely to stall the long-term trend towards higher protein diets in Asia, the Middle East and North Africa.”

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