The UN food agency’s World Price Index was unchanged in November, with a decline in global cereal prices offset by an increase in vegetable oil prices, Reuters reports.
The UN Food and Agriculture Organisation (FAO) price index, which tracks the world’s most traded food commodities, averaged 120.4 points in November, the same level as in October, which was the lowest since March 2021.
Compared to November last year, November’s figures were down 10.7 per cent. The FAO Cereals Price Index decreased by 3.0 per cent in November compared to the previous month, driven by a sharp fall in maize prices, while wheat prices fell by 2.4 per cent. Vegetable oil prices increased by 3.4% compared to October. The FAO said in a statement:
“Palm oil prices rebounded more than 6% in November, chiefly underpinned by more active purchases by leading importing countries and seasonally lower outputs in major producing countries.”
Sugar prices rose 1.4 per cent month-on-month in November but averaged 41.1 per cent higher year-on-year thanks to worsening production prospects in Thailand and India.
The agency’s dairy price index rose 2.2 per cent from October, driven by strong demand for butter and skimmed milk powder in Northeast Asia, as well as stronger pre-holiday demand in Western Europe.
In a separate report on cereal supply and demand, FAO raised its forecast for world cereal production this year to a record 2.823 billion metric tonnes from 2.819 billion previously, up 0.9 percent from 2022. The FAO said:
“Looking ahead to next season, planting of the 2024 winter wheat crop is ongoing in the northern hemisphere and, reflecting lower crop prices, area growth could be limited.”
The agency forecasts a 2.7% increase in global cereal stocks by the end of the 2024 season and a cereal stocks-to-use ratio of 30.8% in 2023/24, which “indicates an overall comfortable level of supply”.
