The world food commodity prices declined for the fifth consecutive month in August, as quotations for most benchmark items dropped, according to a new report released today by the Food and Agriculture Organization of the United Nations (FAO). The FAO Food Price Index averaged 138.0 points in August, down 1.9% from July although remaining 7.9% above its value a year before.
The FAO Cereal Price Index decreased by
1.4% from the previous month, a drop driven by a 5.1% decline in international wheat prices that reflected improved production
prospects in North America and the Russian Federation as well as the
resumption of exports from the Black Sea ports in Ukraine. Rice prices
on average held steady during the month, while quotations for coarse
grains increased marginally, by 0.2%, as firmer world maize
prices due to hot, dry growing conditions in the European Union and the
United States of America were offset by lower barley and sorghum prices.
The FAO Vegetable Oil Price Index decreased by 3.3% from
July, reaching a level slightly below that of August 2021. World soy
oil prices rose moderately due to concerns over the impact of
unfavorable weather conditions on production in the United States of
America, but the gain was more than offset by lower quotations for palm,
sunflower and rapeseed oils, reflecting increased availabilities of
palm oil from Indonesia, due to lower export taxes, and a gradual
resumption of sunflower oil shipments from Ukraine’s ports.
The
FAO Dairy Price Index decreased by 2.0% in August, while
remaining 23.5% above its August 2021 value. World cheese prices
increased for the tenth consecutive month, while those of milk eased
amid expectations of increased supplies from New Zealand, even as
production tracks lower in Western Europe and the United States of
America.
The FAO Meat Price Index declined by 1.5% from
July, but it remained 8.2% higher its value a year ago.
International quotations for poultry meat fell in August amid elevated
global export availabilities, while world bovine meat prices declined on
weak domestic demand in some leading exporting countries. Pig meat
quotations rose.
The FAO Sugar Price Index decreased by 2.1 %
to its lowest level since July 2021, triggered mainly by high
export caps in India and lower ethanol prices in Brazil.
Lower cereal production outlook for 2022
FAO also today issued its updated cereal production forecast for 2022, with a significantly lower outlook. Global
cereal production is anticipated to decline by 38.9 million tonnes, or
1.4 percent, from the previous year, according to the new Cereal Supply and Demand Brief.
The
bulk of the downward revision concerns coarse grains, with maize yields
in the European Union expected to drop 16% below their five-year
average level due to the exceptional hot and dry weather conditions. By
contrast, FAO raised its forecast for world wheat production from its
last report in July to 777 million tonnes, a negligible drop from 2021,
on the back of expected record harvests in the Russian Federation and
conducive weather conditions in North America. Global rice production is
expected to drop by 2.1% from its all-time high reached in 2021.
World cereal utilization for 2022/2023 is now pegged at 2 792
million tonnes, while global cereal stocks at the close of the 2023
seasons are expected to contract by 2.1% to 845 million tonnes.
As a result, the world cereal stocks-to-use ratio is expected to fall
slightly from 30.9% in 2021/22 to 29.5%, a level FAO notes
is still relatively high form a historical perspective.
World
trade in cereals is predicted to decline by 1.9% in 2022/2023
(July/June) from the year-earlier period, to 469.6 million tonnes.
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