The FAO food price index remained largely unchanged in July

The FAO food price index – which tracks the monthly price changes of the most important food commodities in international trade – showed an average of 120.8 points in July, only slightly below the revised June value. The index now closed 3.1% lower than at this time a year ago.

The cereal price index was 3.8% lower than in June, as global exports of major grains have been falling for two months. The price of wheat was lower due to the seasonal increase in supply resulting from the harvests taking place in the northern hemisphere, as well as due to the favorable production conditions in Canada and the United States of America, which justify the expectations for a good spring wheat harvest in the second part of the year. Corn export prices were also lower as harvests in Argentina and Brazil were faster than last year, and crop conditions remained favorable in the United States. The FAO price index for all rice varieties was 2.4% lower than in June, with trade activities for both Indica and Japonica varieties largely calm.

In contrast, the FAO vegetable oil price index increased by 2.4% compared to June, thus reaching a one-and-a-half-year high. Global quotations for palm, soybean, sunflower and rapeseed oils were boosted by the strong demand for soybean oil from the biofuels sector, as well as the worsening outlook for sunflower and rapeseed oil yields in several major producing countries.