After record high, a marginal decline in global food prices
Sharply lower prices for palm, sunflower and soybean oils helped pull down the Food Price Index marginally from its record high that followed Russia’s invasion of Ukraine, said the UN Food and Agriculture Organization. Grain prices also fell during April while meat, dairy, and sugar prices rose.
All told, the index, which measures international prices for a basket of food commodities, dipped 0.8% from the record reached in March. “The small decrease in the index is a welcome relief, particularly for low-income food-deficit countries, but still food prices remain close to their recent highs, reflecting persistent market tightness and posing a challenge to global food security for the most vulnerable,” said FAO chief economist Maximo Torero Cullen.
The vegetable oil index fell 5.7%, one-third of the increase of the previous month. High prices curbed demand for the oils. Meanwhile, China signaled it would have less need for imported oils. Uncertainty about Indonesia’s policy on palm oil exports limited the decline in vegetable oil prices.
Nudged by a 3% drop in corn prices, the grain index declined 0.7% in April. Wheat prices were up 0.2% due to the continued blockage of ports in Ukraine and drought in the U.S. Plains. The sugar index rose 3.3%, the meat index 2.2% and the dairy index 0.9% for the month.
In a companion report, the FAO said it expected a below-average wheat crop in Ukraine, “reflecting the effects of the conflict that are foreseen to reduce the harvested area by at least 20%.”