Eyewitness News: No need for panic over food prices

Reuters | 13 September 2012

LONDON - The head of the United Nations Food and Agriculture Organisation (FAO) on Thursday said there was no need for panic over global food prices, adding that a US report on the outlook for its corn crop had sent a "very good message".

FAO Director-General Jose Graziano da Silva told a conference in Istanbul he did not see a need to convene an emergency G20 forum on food prices at the moment.

"But this is a decision that needs to be considered from week to week. At the moment the prices are very volatile and we are following them very closely," he said.

Fears of a repeat of the unrest and hunger seen in the 2007/08 food crisis emerged as the worst US drought in over half a century and persistent dryness in other key grain producing countries sent corn and soybean prices to successive record highs.

But the US Department of Agriculture on Wednesday cut its forecast for the country's corn crop by less than one percent, indicating the worst drought in US Midwest in 56 years may have done less damage than anticipated.

The forecast raised hopes that a full-blown food emergency could be averted.

Several members of the Group of 20 nations (G20) had considered the need for gathering a meeting of its Rapid Response Forum, which was created last year to respond to abnormal market conditions.

France, which presides over the G20 agriculture body AMIS, had previously said any decision on convening the forum would be made after the 12 September USDA report on grains.

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