World food prices stabilized in January after falling in the previous three months, the United Nations food agency said on Thursday, but it warned that adverse crop weather could cause violent price spikes due to tight grains stocks.
Global food prices surged in mid-2012 following the worst U.S. drought in more than half a century and dry weather in other key grains exporters, raising fears of a food crisis similar to the one in 2008.
But prices eased in the last three months of 2012 due to expectations that large South American production will replenish tight global cereals supplies.
On Thursday Brazil said it would produce a record 83.4 million metric tons (91.93 million tons) of soybeans this season due to unprecedented expansion in area planted after a disappointing harvest last year, and also forecast a record corn crop.
The Food and Agriculture Organisation (FAO) said its food price index, which measures monthly price changes for a basket of cereals, oilseeds, dairy, meat and sugar, averaged 210 points in January, unchanged from December.
The Rome-based agency raised its view of world cereal output in 2012 to 2.302 billion metric tons, up 20 million metric tons from its previous forecast, but still 2 percent lower than the bumper crop in 2011.
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