Global Food Prices Decline for 7 Consecutive Months...Grains and Oils Down, Sugar, Dairy, and Meat Up

February Global Food Price Index

Global food prices have declined for the seventh consecutive month. However, prices for meat, dairy products, and sugar have risen.

According to the United Nations Food and Agriculture Organization (FAO) on the 9th, the global food price index in February this year recorded 117.3 points, down 0.7% from the previous month. The global food price index has been on a downward trend for seven consecutive months since it fell by 2.6 points to 122.0 points in August last year.

Prices for cereals (-5.0%) and oils (-1.3%) fell, while prices for meat (1.8%), dairy products (1.1%), and sugar (3.2%) rose.

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The cereal price index in February was 113.8 points, down 5.0% from 119.9 points in the previous month. International wheat prices fell due to increased exports of Russian wheat. The decline in Russian wheat export prices also affected the price drops of wheat from other regions such as Europe. Corn prices also fell as large harvests were expected in Argentina and Brazil, while Ukraine enhanced price competitiveness by utilizing smooth maritime transport. International rice prices also declined, which the Ministry of Agriculture, Food and Rural Affairs analyzed was due to the start of new rice harvests in some countries and stagnant import demand in most countries except Indonesia.

The oils price index was 120.9 points, down 1.3% from 122.5 points in the previous month. International soybean oil prices fell as soybean production in South America was expected to be sufficient and overall harvesting conditions were favorable. Prices of sunflower seed and rapeseed oils also declined as global export availability remained ample. On the other hand, international palm oil prices rose slightly as major producing countries in Southeast Asia entered a period of reduced production.

The meat price index rose 1.8% to 112.4 points from 110.5 points in the previous month. International beef prices increased as heavy rains in major Australian production areas restricted livestock movement, reducing supply more than expected. International poultry prices also rose due to increased demand from major importing countries. Pork prices increased as supply remained tight while import demand from China and domestic demand in Western Europe both rose.

The dairy price index also rose 1.1% to 120.0 points from 118.7 points in the previous month. Butter prices increased as milk production decreased in the Oceania region while import demand in Asia rose. Whole milk powder prices also rose, especially due to increased import demand centered on China, but the rise was limited by price declines in Europe. Skimmed milk powder prices remained stable. In Oceania, prices rose, but in Europe, prices fell due to reduced demand caused by increased transportation costs and delays from conflicts in the Red Sea region. Cheese prices rose due to low stock levels in Europe and increased demand in Asia.

The sugar price index recorded 140.8 points, up 3.2% from 136.4 points in the previous month. The upward trend in international sugar prices continued amid concerns over production disruptions due to persistent low rainfall in Brazil. Additionally, production declines were forecasted in major exporting countries such as Thailand and India. However, the rise in sugar prices was moderated by rainfall recovery in late February in Brazil’s key production areas and the depreciation of the Brazilian real against the US dollar.

Food Price Index by Year