Global food import bills may pass the $1 trillion mark in 2010, a level not seen since food prices peaked in 2008, says a new United Nations report, which warns that harder times could be ahead without a major increase in food production next year, the UN News Service reported on November 17 2010.

According to the latest edition of the Food Outlook report, released by the UN Food and Agriculture Organization, food import bills for the world's poorest countries are predicted to rise 11 per cent in 2010 and by 20 per cent for low-income food-deficit countries.

"With the pressure on world prices of most commodities not abating, the international community must remain vigilant against further supply shocks in 2011 and be prepared," the Rome-based agency said, quoted by the UN News Service.

With global cereal stocks expected to decline sharply, the report calls for boosting production to replenish inventories.

World cereals stocks are anticipated to shrink by six per cent according to FAO, with barley plunging 35 per cent, maize 12 per cent and wheat 10 per cent. Only rice reserves are expected to increase – by six per cent.

"Given the expectation of falling global inventories, the size of next year's crops will be critical in setting the tone for stability in international markets," FAO said.

"For major cereals, production must expand substantially to meet utilization and to reconstitute world reserves, and farmers are likely to respond to the prevailing prices by expanding plantings."

"Cereals however may not be the only crops farmers will be trying to produce more of, as rising prices have also made other commodities attractive to grow, from soybeans to sugar and cotton.

"This could limit individual crop production responses to levels that would be insufficient to alleviate market tightness. Against this backdrop, consumers may have little choice but to pay higher prices for their food," FAO said.

Global food prices could rise further if production next year does not increase significantly – especially in maize, soybean, and wheat, the report said.

According to FAO, the price of sugar – which recently surpassed 30-year highs – was a major reason for the rise in the price of the global food basket in recent months.

Meat prices have also risen but the increase has been far more contained so far, while butter has already hit an all time high, the agency reported. Fish also registered large price gains, showing a strong recovery after sharp falls since the end of 2008.