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Global food prices fall by most in two years

The price of food around the world slid in May for the second month, tumbling the most since March 2010.

An index calculated by the United Nations’ Food and Agriculture Organisation tumbled to 203.9 in May from 213, a 4% slide. That’s the lowest level since September 2010 and the steepest fall since March 2010.

From the index’s peak in February, it’s a 14% plunge.

Harvesters delivered excess supply amid a stronger dollar and growing economic instability around the world. A bumper corn crop is expected in the U.S. World cereal production for the year is predicted to reach a record 2.4 billion tons, up 3.2% from the 2011 record.  

But planting is still in progress, warned the organization’s grain analyst Abdolreza Abbassian.

"Crop prices have come down sharply from their peak level but they remain still high and vulnerable due to risks related to weather conditions in the critical growing months ahead," he said.

Meat prices barely moved, though they’re up over the first five months of the year compared to the same period a year earlier. Lamb and beef prices are up while pork is down.

The index for dairy, however, slumped 12% in May, hitting the lowest level since October 2009. Cheese and butter made the deepest declines.

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