FAO food price index rose in February

The FAO food price index, which tracks monthly changes in the prices of the world’s most important food commodities, rose 1.6% from the previous month and 8.2% from a year earlier.

The rise was driven mainly by the sugar price index, which has risen 6.6% since January after three months of decline. The rise may have been driven by concerns about a potential global supply squeeze for the 2024/25 season, fuelled by a worsening production outlook in India and adverse weather conditions in Brazil.

The dairy price index rose by 4% in February, driven by higher consumer prices for products such as cheese and whole milk powder, as well as strong import demand exceeding production in major exporting regions.

The vegetable oil price index rose by 2% compared to January and by 29.1% compared to a year earlier. Behind the trend, we see higher prices for palm, soybean and sunflower oil, driven by potential seasonal supply problems in Southeast Asia and strong demand from the biofuel sector.

Global cereal prices edged up by 0.7% in February. Wheat prices rose on tighter Russian supplies and concerns about production conditions in Eastern Europe and North America, but the index still fell short of its February level. Global corn prices continued to rise due to weak Brazilian exports and rising US imports. In contrast, global rice prices fell by 6.8% due to a combination of ample export supply and weak demand.

The meat price index remained largely unchanged in February, as poultry and pork prices fell due to ample supplies and mutton and beef prices held steady amid strong global import demand.