Food prices fall in December after ‘two very volatile years’: FAO


The UN agency has published its latest Food Price Index (FFPI), which tracks monthly international prices of grains, vegetable oil, dairy, meat and sugar.

The FFPI averaged 132.4 points last month, which is one percent lower than in December last year.

However, last year it averaged 143.7 points – more than 14 percent higher than the average value over 2021.

Beware of food insecurity

“Quiet food commodity prices are welcome after two very volatile years,” said FAO chief economist Maximo Torero.

“It is important to remain vigilant and strongly focused on reducing global food insecurity, given that world food prices remain at high levels, with many commodities near record highs, and with rice prices rising, and still many risks associated with future deliveries. he added.

The FFPI was “significantly higher” in 2022 than in 2021, which, on top of major increases that year, led to “significant tensions and concerns about food security” for poorer food-importing countries, the FAO said.

This prompted the International Monetary Fund (IMF) to introduce a “Food Shock Window” inspired by the agency.

World prices of wheat and maize reached a record high last year and the average value of vegetable oils hit a new all-time high, while individual indices for dairy and meat prices also recorded their highest annual levels since 1990.

Decrease in December

December’s lower FFPI was led by a fall in the vegetable price index, which fell 6.7 percent from the previous month and reached its lowest level since February 2021.

International quotations for palm, soybean, rapeseed and sunflower oils all fell last month on weak global import demand and prospects of seasonally rising soybean oil production in South America, as well as falling crude oil prices.

The grain price index fell by almost two percent in November. The ongoing harvests in the southern hemisphere boosted wheat stocks for export, while strong competition from Brazil drove corn prices down.

However, rice prices rose, largely supported by “Asian purchases and currency appreciation against the US dollar for exporting countries.”

Christmas boost in Europe

Last month, the meat price index also fell by 1.2 percent. For example, beef prices were affected by “weak demand for medium-term supplies,” the FAO said, while poultry costs were depressed because of “more than adequate export stocks.”

Meanwhile, pork prices rose, largely supported by strong pre-Christmas demand, particularly in Europe.

The Dairy Price Index rose 1.2 percent in December, after five consecutive months of declines. The FAO attributed this to higher international cheese prices due to tightening market conditions, although international quotations for butter and milk powder fell.

The sugar price index also rose 2.4 percent from November, mainly due to concerns about the impact of adverse weather conditions on crop yields in India and delays in sugar cane milling in Thailand and Australia.

Source link


Please enter your comment!
Please enter your name here