The international prices for major food commodities saw a modest decline in July, following five consecutive months of increases, according to the United Nations Food and Agriculture Organisation (FAO).
The FAO Food Price Index, a trade-weighted gauge tracking international market prices for five major food commodity groups, averaged 161.9 points in July 2016, slipping 0.8 per cent below its level in June and 1.4 per cent below its July 2015 level.
The overall decline was largely caused by drops in international quotations of grains and vegetable oils, more than offsetting firmer dairy, meat and sugar prices.
Cereal prices fell 5.6 per cent from June, led by a sharp drop in maize prices due to favorable weather conditions in the key growing regions of the United States, the world’s largest maize producer and exporter.
Wheat prices also fell in July mainly driven by large global supplies and prospects for abundant export availabilities from the Black Sea region. By contrast, rice prices strengthened somewhat, as dwindling availabilities underpinned Basmati and long-grain quotations.
Falling for the third consecutive month, vegetable oil prices dropped 2.8 per cent from its level in June. The slide was mainly driven by palm oil, whose price dropped to a 5-month low, reflecting a seasonal recovery in production in Southeast Asia combined with subdued global import demand. Prices for soybean, sunflower and rapeseed oil also eased on better than earlier anticipated supply prospects.
Dairy prices rose 3.2 per cent from the previous month, with butter prices seeing the sharpest rise in the group. Yet, they remain at very low levels compared to recent years.
Meat prices increased 1.3 per cent from its revised June value. Quotations for all meat products remained firm, underpinned by a shortage of pigs for slaughter in the European Union and reduced output of sheep and bovine meat in Oceania. International demand for meat remains strong, supported by a recovery in purchases by China and sustained imports by several countries elsewhere in Asia.
Sugar prices rose 2.2 per cent in the month, largely influenced by movements in the Brazilian currency, which strengthened against the US dollar in July.
This story was published with permission from The UN News Centre.