FAO reports slight uptick in global food prices, driven by meat and vegetable oils, despite declines in sugar and dairy.
The Food and Agriculture Organization of the United Nations (FAO) revealed in its latest report that the FAO Food Price Index experienced a marginal increase in April. This index, which serves as a benchmark for world food commodity prices, rose by 0.3 percent from its revised March level, albeit still down by 9.6 percent from the previous year.
Cereal Prices See Mixed Trends
The FAO Cereal Price Index saw a slight rise of 0.3 percent, breaking a three-month declining trend. While wheat export prices stabilized due to fierce competition among major exporters, concerns loom over crop conditions in parts of the EU, Russia, and the USA. Meanwhile, maize export prices surged amidst high demand and logistical disruptions, particularly in Ukraine and Brazil. However, the All-Rice Price Index faced a decline, primarily driven by harvest pressures.
Vegetable Oils Reach 13-Month High
In contrast, the FAO Vegetable Oil Price Index hit a 13-month high, with sunflower and rapeseed oil prices on the rise. Despite slightly lower prices for palm and soy oil, the overall index increased by 0.3 percent.
The FAO Meat Price Index witnessed a 1.6 percent increase, buoyed by rising international prices for poultry, bovine, and ovine meat. However, pig meat prices experienced a marginal fall, attributed to weak demand in Western Europe and major importers like China.
Sugar and Dairy Face Declines
Conversely, the FAO Sugar Price Index plummeted by 4.4 percent, owing to improved global supply prospects, particularly in India, Thailand, and Brazil. Similarly, the Dairy Price Index dipped by 0.3 percent, ending six months of consecutive increases, primarily due to sluggish demand for skim milk powder and lower cheese prices.
In addition to the price index update, FAO released its Cereal Supply and Demand Brief, revising the forecast for world total cereal production in 2023 to 2,846 million tonnes, reflecting a 1.2 percent increase from the previous year. The forecast for global wheat production in 2024 was adjusted downward, now standing at 791 million tonnes, though still marking a 0.5 percent increase from 2023.
Despite these adjustments, the outlook remains uncertain, especially with the onset of the main harvest period in southern hemisphere countries, where adverse weather conditions have dampened yield prospects, notably in Brazil and South Africa.