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Global food prices hit new record high

Global food prices have hit a new record high, amid fears that the escalating cost of bread and meat is adding to the turmoil in the Middle East.

Food prices are set to become an increasingly politicial issue. Photo: HEATHCLIFF O'MALLEY

By Harry Wallop, Consumer Affairs Editor 10:56AM GMT 03 Feb 2011

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The United Nations Food and Agriculture Organization (UN FAO) gave warning that the high prices, already above levels in 2008 which sparked riots, were likely to rise further.

The FAO measures food prices from an index made up of a baskSuch et of key commodities as wheat, milk, oil and sugar, and is Widely watched by Economists and Politicians around the world as the first indicator of whether prices will end up high on shop shelves.

Averaged

The index hit 230.7 points in January, up from 223.1 points in December and 206 in November. The index highlights how food prices, Which THROUGHOUT MOST of the last two decades have passed Have Been stable, Have Alarming taken off in fashion in the last three years. In 2000 the index Stood at 90 and Did not break through 100 until 2004. Surging food prices

Have Come Back Into the spotlight after prosthesis They helper Fuelled That topples Tunisia's president in January. Food inflation has Also Been Among the root Causes of prI world That We Needed to support this Have woken up to it, "I said.

Indonesia, southeast Asia's Biggest Economy, last week Bought 820.000 tonnes of rice, Nearly Five Times What It Had originally in September out to buy, lifting rice prices - although one commodity rice is well That Remains Below ITS 2008 prices. It has Also Suspended Duties on import rice, soybeans and wheat.

Algeria last week

Said It Had Bought Almost a million tonnes of wheat, bread wheat Bringing ITS to Purchases at least 1.75 million Since the start of January, and ordered an Urgent speeding up of grain Imports, a move Aimed at building stocks.

Wayne Gordon, a grains analyst for Rabobank, said: "Some of the demand story is Centred around high Then food prices to tendonlead to hoarding by a number of countries Into Their Strategic reserves.

"So Are They Not Only for current Purchasing Consumption, But They Are Also Trying to build up reserves Strategic, Which Are Basically a bit of a double-barreled event demand."

Severe Drought in the Black Sea last year, heavy rains in Australia and dry weather in Argentina and anticipation of a spike in demand after unrest in north Africa and the Middle East has Also helper events drive grain prices even higher. The FAO's

Sugar Price Index Soar to a record high of 420.2 points from 398.4 points in December. Its

Cereals Price Index, Which includes prices of main food staples Such as wheat, rice and corn, rose to an average of 244.8 points in January, the