Food prices, stable for third straight month, appear to have 'bottomed out' – UN

“The index appears to have bottomed out with higher probabilities for a rise in its value in coming months” said Abdolreza Abbassian, senior economist at FAO, in a press release on the monthly survey .

Last month, the Index averaged 192.6 points, meaning it now stands 13 points – or 6.4 per cent – below its level a year ago. The trade-weighted index, which tracks prices of cereals, meat, dairy products, vegetable oils, and sugar on international markets, is now around its level of August 2010.

The inching up of vegetable oil and grain prices offset ongoing declines in dairy prices. Dairy prices declined 3.4 percent from October and 29 percent from a year earlier to average 178.1 points.

Cereal prices rose significantly for the first time since March, as growing conditions for the just-sown wheat crop in the Northern hemisphere, appear less than ideal. However, rice prices weakened as newly-harvested supplies arrived to market. The Cereal Price Index averaged 183 points in November, up 2.6 percent from October, but down 5.8 percent from a year earlier.

The Vegetable Oil Price Index also rose, increasing 0.7 percent to 164.9 points – still almost 17 percent below its level a year earlier – due to lower-than-anticipated global production of sunflower oil and some slowdown of palm oil production in Malaysia and Indonesia. However, soy oil prices were weak, dampening the sub-index's rise.

Sugar prices were down 3.2 percent from October, reflecting an 8 per cent decline over the year, and meat prices remained stable at historically high levels.