FAO Reports Surge in Vegetable Oils, Dairy, and Meat Prices
Global food prices experienced a turnaround in March, marking the end of a seven-month decline, as reported by the United Nations Food and Agriculture Organization (FAO) on March 5, 2024. The FAO Food Price Index rose by 1.1 percent, driven by significant increases in vegetable oils, dairy, and meat quotations.
The FAO Food Price Index, a crucial metric monitoring monthly changes in international prices of key food commodities, averaged 118.3 points in March. Despite being 7.7 percent lower compared to the previous year, this uptick signals a positive shift from recent trends.
Leading the surge was the FAO Vegetable Oil Price Index, which soared by 8.0 percent from February to reach a one-year high. This rise was fueled by increased prices for palm, soy, sunflower, and rapeseed oils, attributed to seasonal production dips in major producing regions and heightened domestic demand in Southeast Asia.
Similarly, the FAO Dairy Price Index continued its upward trajectory for the sixth consecutive month, climbing by 2.9 percent in March, driven by soaring world cheese and butter prices. The FAO Meat Price Index also recorded a 1.7 percent increase, with prices for poultry, pig, and bovine meats all on the rise.
In contrast, the FAO Cereal Price Index experienced a 2.6 percent decline, predominantly due to lower global wheat export prices amid fierce competition among major producers. However, maize export prices witnessed a slight increase, partly due to logistical challenges in Ukraine.
Additionally, the FAO Sugar Price Index fell by 5.4 percent from February, attributed to an upward revision in India’s 2023/24 sugar production forecast and improved harvesting rates in Thailand.
In its Cereal Supply and Demand Brief, the FAO forecasted a rise in world cereal production to 2,841 million tonnes in 2023/24, anticipating greater outputs of maize, rice, and wheat. Global cereal utilization is projected to increase by 1.3 percent, with cereal stocks expected to reach 894 million tonnes by the season’s end.
Looking ahead, world trade in cereals is anticipated to increase by 1.7 percent in 2023/24, with expansions in coarse grains trade offsetting contractions in wheat and rice trade. The dynamic nature of global food markets underscores both challenges and opportunities shaping the upcoming year.
