GLOBAL – The Food and Agriculture Organization (FAO), a United Nations agency, has disclosed that the global food price index rose in April, up 0.6% from the previous month for the first time in a year
The agency attributed the slight rebound in April to increases in the sugar, meat, and rice price index which offset declines in the major food commodity categories price indices.
According to the report, the FAO Food Price Index (FPI) averaged 127.2 points in April against 126.5 for March, a slight monthly increase but still nearly 20% below its value in the corresponding month last year.
The report indicated that food prices are still 19.6 percent down from a record high hit in March 2022, but still 5.2 percent higher than in April 2021.
In its Cereal Supply and Demand Brief, FAO said the Cereal Price Index averaged 136.1 points in April. Meanwhile, the FAO Cereal Price Index dipped 1.7 percent from March and averaged 19.8 percent below its April 2022 value.
The report highlights that international wheat prices declined by 2.3 percent, due mostly to large exportable availabilities in Australia and the Russian Federation.
FAO added that “favorable crop conditions in Europe, along with an agreement at the end of April allowing Ukrainian grains to transit through the European Union countries that had imposed import restrictions on grain from Ukraine earlier in the month, also contributed to the overall softer tone in markets”.
World maize prices fell 3.2 percent as supplies in South America seasonally increased with ongoing harvests.
Among other coarse grains, FAO reported that world prices of barley and sorghum also declined, by 4.3% and 0.3%, respectively, reflecting weak global demand and spillover from weakness in international maize and wheat markets.
The FAO Vegetable Oil Price Index declined by 1.3 percent in the month, registering its fifth consecutive monthly decline.
World palm oil prices were stable, while quotations for soy, rapeseed, and sunflower oils declined in step with seasonal harvest pressure from a potentially record soybean crop in Brazil.
Amid the decline in cereal prices, FAO raised its forecast for world cereal production in 2022 to 2.785 billion tonnes from a previous 2.777 billion.
According to FAO, against a backdrop of reduced harvests caused by higher input costs and adverse weather, especially outside of Asia, sales to Asian buyers sustained an increase in international rice prices.
Therefore, FAO’s 2023/24 projections for rice production were termed “mixed”, largely due to the regionally varied impact of the La Niña event.
World cereal utilization in 2022/23 is forecast at 2,780 million tonnes, and world cereal stocks by the close of the season to stand at 855 million tonnes.
“Based on these latest forecasts, the 2022/23 global cereal stocks-to-use ratio would stand at 29.8 percent, down slightly from 30.8 percent during the previous 12 months, but still indicating a relatively comfortable supply level globally,” FAO said.