Global food prices fell 1 per cent in February to their lowest in more than four-and-a-half years, with cereals, meat and sugar declining, oils steady and only dairy prices rebounding sharply, the United Nations food agency said on Thursday.

The U.N. Food and Agriculture Organization's (FAO) price index, which measures monthly changes for a basket of cereals, oilseeds, dairy, meat and sugar, averaged 179.4 points last month, 1.8 points below its reading in January.

High global production, low crude oil prices and limited demand from major importers including China have helped cap food prices for the past year and the index has now been declining since April 2014 to reach its lowest since July 2010.

Cereal stocks at the end of the 2014-15 season are now forecast to reach 630.5 million tonnes, up almost 8 million tonnes from a previous reading to reach their highest levels in 15 years.

FAO's forecast for world cereal production in 2015 reached 2.542 billion tonnes, 8 million tonnes above the forecast made in January.

Cereals prices were down 3.2 per cent from January, with wheat prices sharply lower on better production prospects and large inventories.

Meat prices fell 1.4 per cent, pulled down by cheaper beef, mutton and lamb that outweighed stable poultry prices and higher pork prices.

Following eight months of decline, pork prices were bolstered by the announcement of European subsidies for private storage.

Sugar prices fell 4.9 per cent from January on higher output from Brazil, the world's largest sugar producer and exporter, together with a weakening in the Brazilian real currency and the announcement of sugar export subsidies from India.

A slight rise in palm oil prices, following floods in Malaysia and an increase in biodiesel subsidies in Indonesia, lifted the vegetable oil price index by 0.4 per cent.

Dairy prices showed the strongest gains, rising 4.6 per cent from January to post their first increase in a year. The rise was caused by drought in New Zealand and limited export supplies from Australia, together with a curb in European production to avoid breaching output quotas. – Reuters