Global Food Prices Fall for 9 Consecutive Months... Wheat and Palm Oil Prices Also Decline

[Asia Economy Sejong=Reporter Kim Hyewon] Global food prices continued their decline for the ninth consecutive month.

According to the Ministry of Agriculture, Food and Rural Affairs on the 7th, the Food Price Index released last month by the United Nations Food and Agriculture Organization (FAO) stood at 132.4, down 1.9% from the previous month (135.0). The global food price index has been falling for nine months since reaching a peak of 159.7 in March last year.

By category, prices of grains, oils, and meat decreased, while prices of dairy products and sugar increased. Last month, the grain price index dropped 1.9% from the previous month to 147.3. Wheat prices fell due to increased supply during the harvest season in the Southern Hemisphere, and corn prices declined due to increased supply from Brazil. On the other hand, rice prices rose due to increased imports in Asia and currency effects in some countries.

The oils price index fell 6.7% from the previous month to 150.1. Palm oil prices declined as supply decreased in major producing countries, but global demand also weakened. Soybean oil prices dropped due to expected production increases in South America.

The meat price index also fell 1.2% from the previous month to 113.8. Beef prices declined as supply increased in major producing countries and international demand decreased. Poultry prices fell despite reduced supply caused by the worsening avian influenza (AI), as exportable volumes exceeded import demand. Conversely, pork prices rose due to increased demand ahead of the Christmas holidays in Europe.

The dairy price index rose 1.1% from the previous month to 139.1. Cheese prices increased due to higher import demand, while milk powder prices fell due to decreased demand in Western Europe.

The sugar price index increased 2.4% to 117.2. Prices rose as India, the world's second-largest sugar producer, is expected to have a poor harvest, and sugarcane processing delays occurred in Thailand and Australia.

The Ministry of Agriculture, Food and Rural Affairs expects food prices to remain generally stable this year but notes uncertainties remain due to weather conditions in South America, the situation in Ukraine, and changes in demand from China.

FAO monitors international price trends for 24 items and publishes monthly food price indices for five categories: grains, oils, meat, dairy products, and sugar.