Fao Food Price Index: Slightly downward trend

The Fao food price index in April 2022 was down 0.8 percent from its peak level in March. The index, which tracks the prices of the world’s major traded commodities, was still up 29.8% from its April 2021 level.

The Fao vegetable oil price index fell 5.7 percent in April, posting nearly a third of the increase recorded in March. Rationing of demand pulled down prices of palm, sunflower and soybean oils. Uncertainty about exportable supplies from Indonesia, the world’s largest palm oil exporter, has contained a further decline in international prices.

« Vegetable oil and corn prices fell slightly in April, after their recent surge. At the same time, those of rice, meat, dairy products and sugar increased slightly, while the outlook for world trade is deteriorating, » said Fao.

Indeed, « this slight decline in the index is welcome, especially for low-income food-deficit countries. But food prices remain close to their recent highs, due to the continued tightness of the market. This is undermining the food security of the most vulnerable around the world, » said Fao’s Chief Economist, Máximo Torero Cullen.

The Fao Cereal Price Index saw a decline in April, due to a 3.0% drop in world corn prices, he added.

Wheat prices hit by Ukraine port blockade

International wheat prices, which are being strongly impacted by the prolonged port blockade in Ukraine and concerns about U.S. growing conditions, gained 0.2%. This was tempered by increased shipments from India and higher than expected export volumes from the Russian Federation. International rice prices rose 2.3% from their March levels, supported by strong demand in China and the Near East.

Meanwhile, the Fao sugar price index rose 3.3%, driven by higher ethanol prices and concerns about the slow start to the 2022 crop in Brazil, the world’s largest sugar exporter.

The Fao meat price index rose 2.2 percent from the previous month to a new record high as prices for poultry, pork and beef climbed. In addition, disruptions to exports from Ukraine and the spread of avian influenza in the Northern Hemisphere impacted poultry prices.

The dairy index was also up 0.9 percent due to continued tightness in global supplies. Indeed, milk production in Western Europe and Oceania continued to perform below seasonal levels. The largest increase was in international butter prices, where demand soared due to the current shortage of sunflower oil and margarine.