Global food prices are on course to hit an all-time high in next year, according to a new report from Rabobank. It said that higher meat and dairy prices would be the key drivers behind the increase in the FAO Food Price Index, although the effects of higher animal feed prices on these sectors would not necessarily be immediate but could linger for some time to come. Rabobank predicts that the Index will jump up by a further 15% to 243 points by the end of next June. Current food price records set in 2011 were “likely to be broken” as the market realised just how tight the fundamental supply and demand situation on key commodities was. The bank’s Luke Chandler said: “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. “These commodities are currently 30% cheaper than their 2008 peaks. But in developed economies – especially the US and Europe – where meat and corn price elasticity is low, the knock-on effect of high grain prices will be felt for some time to come.”

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