Next time post what difficulty you're playing at. Food is a lot more important at higher difficulty levels. At noble I barely took it into consideration - and got away with it. One can't get away with that on Monarch.
Also, what civ / map type you're playing on.
You're Portugal?
The location the settler is on looks good. Lots of food. Coastal access to build ships later. Lots of hills for production and trees to chop for rushing wonders, settlers, whatever. Plus you got silver for happiness (+2 with forge, same as Notre Dame) and some extra cash, which is good for a capital (+8 gold from palace, build a marker, grocer, bank etc. later down the road, if you run Buracracy (spelling) that's serious bucks.) So I would start him off right there. Build a tririme soon to protect those crab fishermen from barbarian galleys.
If you build Maoi Statues, which I'd take my time with as it is expensive, you'ld have a diesel all around city production for wonders and units (sea and land) and lots of gold for research and money.
This position is ideal for portugal - you'll have a production coastal city to pump out your UU and hopefully grab some land no one else can, and the UB will make you that much more cash.
I always settle in the default position. I've played probably 25 full games and 15 half games and never regreted it. The only time I didn't settle in a default position was in an Earth map, I was in tundra so I moved somewhere warmer. I've seen the computer not do that - it's a disaster.