World food prices are likely to fall in 2012 as fears of economic recession sap demand and supplies remain adequate, but they can rebound if weather hits crops in main producers and demand picks up, a senior economist at the United Nations' food agency said on Thursday.
"There is certainly a declining tendency (in food prices) amplified by the fact that on the demand side the situation is not that favourable and the supplies are pretty adequate ...for almost all commodities," Abdolreza Abbassian of the UN's Food and Agriculture Organisation (FAO) told Reuters.
Global food prices measured by FAO fell in December from the previous month, extending falls seen in the past several months.
"The only upside risks on prices should we see in the coming weeks and months will arise should the weather developments start to really have an implication for production for 2012," Abbassian said in a telephone interview.
"Also a demand if it picks up faster later in the year is also a possibility that we cannot ignore," he added.
World food prices, which reached record highs in 2011, will not collapse this year and volatility seen last year will remain a norm, he said. (Reporting by Svetlana Kovalyova; editing by Jason Neely)