Food prices fell 7% last year according to latest data from the UNFAO Food Price Index.

The Index – which measures monthly changes in international prices of a basket of food commodities – stood at 212 points for 2012 as a whole, 7% less than in 2011.

Year-on-year, the sharpest falls were recorded for sugar – which fell 17.1%, dairy (14.5%) and oils (10.7%). There were lesser declines in cereals (2.4%) and meat (1.1%).

December saw the third consecutive monthly fall in the Index, which took it down to 209 points.

The result marked a reversal from the situation last July, when sharply rising prices prompted fears of a new food crisis, said Jomo Sundaram, assistant director-general in charge of the FAO’s Economic and Social Development Department. “International coordination, including through the Agricultural Market Information System, as well as flagging demand in a stagnant international economy helped ensure the price spike was short-lived and calmed markets so that 2012 prices ended up below the previous year’s levels.”   

The AMIS is a G20 initiative to bring about greater food market transparency.

See The Grocer this weekend for our outlook on what lies in store for food prices in 2013.