High crude oil prices and biofuel mandates will also underpin oilseeds and vegetable oil prices. About 16 percent of global vegetable oil production should be used to produce biodiesel by 2021.
Meanwhile, ethanol production is set to absorb 14 percent of global coarse grain production and 34 percent of sugarcane production by that date, the report said.
Sugar prices will stay at high levels, underpinned by low stocks, and further bouts of price surges and volatility are possible in response to unforeseen production shocks.
Meat prices are also set to remain on a high plateau during the next decade under persistently high production costs and more stringent food safety, environmental and animal welfare regulations, the report said.
FAO and OECD said farms should aim to boost productivity in a sustainable way to help contain food price rises and reduce the insecurity of global food supplies.
It said this could be achieved through more efficient use of irrigated water, fertilisers and crop protection products, investing in agricultural research and innovation and introducing policies that encourage these changes. (editing by Jane Baird)