Global food prices jumped 2.6 percent in February, the sharpest increase since mid-2012, largely due to unfavorable weather, the U.N. food agency said Thursday, with the crisis in Ukraine threatening to cause future volatility. The Rome-based Food and Agriculture Organization (FAO) said its price index, which measures monthly price changes for a basket of cereals, oilseeds, dairy, meat, and sugar, averaged 208.1 points in February, up 5.2 points from the previous month. Unfavorable weather conditions in the southern hemisphere and parts of the United States were the biggest cause of the increases, FAO senior economist Abdolreza Abbassian said. In February, prices rose in all commodity groups except meat. The strongest rise was in the sugar sub-index, which rose 6.2 percent due to worries of crop damage from dry weather in Brazil and forecasts indicating an output drop in India. Abbassian warned that market nervousness about the crisis in Ukraine—a major grain producer—could affect prices in March. "The situation in the Black Sea has created a certain level of worry in the markets," he said. "It's difficult to predict how this is going to unfold, but obviously we are in a very short-term price-shock situation," Abbassian said. "Things could come back to normal once the Ukraine situation improves. Otherwise, there could be more volatility in the markets for the foreseeable future."
