Futures & Commodities

Ukraine and bad weather push up food prices: UN

World food prices reached their highest level in nearly a year in March, driven by turmoil in Ukraine and poor weather, according to a report from the United Nations.

The FAO food price index—a measure of the price of food commodities, published by the UN's Food and Agriculture Organization (FAO) Thursday—hit 212.8 points last month, its highest level since May 2013.

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Wheat field in Brazil
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"Last month's increase was largely driven by unfavorable weather conditions affecting some crops, and geopolitical tensions in the Black Sea region," said the international body on its website.

Apart from dairy, all food commodity prices rose, with sugar and cereals seeing the biggest gains.

The FAO attributed the increase in cereal prices to the impact of poor weather in south central U.S. and Brazil, coupled with the tensions in Ukraine.

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"Geopolitical tensions in the Black Sea region, in particular uncertainties with regard to grain shipments from Ukraine, also provided a boost," it said.

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These uncertainties helped push dairy prices lower, for the first time in four months, however.

"Demand for all dairy products has been affected by reduced purchases from China and uncertainty over trade with the Russian Federation," said the FAO.

Protracted dry weather in the U.S., Australia and South East Asia has hampered agricultural production and boosted prices this year, as has fears of an El Nino weather-event this summer.

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Food commodity prices also rose sharply in February, according to the FAO.

Wheat, corn, cocoa, sugar, coffee and soybeans all traded higher on Thursday. Rice was roughly flat.

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—By CNBC's Katy Barnato. Follow her on Twitter: @KatyBarnato