While the move is encouraging, the index remains 36% above its April 2010 values and only 2% below its peak in February, keeping food-price concerns a top priority around the world.

The Food and Agriculture Organization (FAO) of the United Nations reported that their food price index averaged 232 points in April, flat from March and 2.6% below its all-time high February level of 237.2.  While it is encouraging to see the index stabilizing after it recorded eight consecutive months of gains to February, food prices remain extremely high and, amid a general wave of inflation around the globe, continue to pose a threat to any sort of economic recovery. (Read Global Food Prices Hit All-Time High As Violence Erupts In Yemen).

While the fall was led by sugar and rice prices, most other commodities remained steady, with meat still flirting with record highs.  David Hallam, director of the FAO’s trade and market division, noted that demand remained strong due to a sliding dollar and rising oil prices, with a return to normal prices hinging how much production can recover in 2011.

Optimism is not warranted, though, as fundamental factors are poised to keep the market tight and prices high in the medium to long-run.

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