FAO Food Price Index rebounds in July

The FAO food price index – which tracks month-to-month price changes for the most important food commodities in international trade – has fallen by 2.1% since July, below its March 2022 peak.

After a 12.1% jump in July, the vegetable oil price index fell by 3.1% in August. Global sunflower oil prices fell 8% last month after global import demand weakened amid abundant export supply. Soybean oil was also quoted lower thanks to the improvement in American production conditions, while the price of palm oil barely decreased.

The FAO cereal price index has contracted by 0.7% since July. Experts suspect higher seasonal supply behind the 3.8% drop in the international price of wheat in August, while the 3.4% price drop of grain products is explained by the record Brazilian corn crop and the start of the American harvest.

In stark contrast to these, the FAO rice price index rose by 9.8% last month, jumping to the nominally highest value of the past 15 years. All this is a consequence of the commercial difficulties caused by the introduction of the ban on the export of the Indica type rice in India – the world’s largest rice exporter. Concerns about the duration of the ban and the response of supply chain actors have all had a negative impact on rice trade volumes.