World food prices hit two-year high on rising edible oil costs among other commodities: FAO
The Vegetable Oil Price Index soared to 166.8 points, a 7.1% month-on-month jump.
GLOBAL /FRANCE- Global food prices climbed to their highest level in over two years this July, driven by sharp increases in meat and vegetable oil costs, according to the United Nations’ Food and Agriculture Organisation (FAO).
The FAO Food Price Index, a key benchmark for international food commodity prices, rose to 130.1 points, marking a 1.6% increase from June and the highest reading since February 2023.
The Vegetable Oil Price Index soared to 166.8 points, a 7.1% month-on-month jump and the highest level in three years.
The increase was driven by robust global demand and tightening supplies of palm, soy, and sunflower oils, although rapeseed oil prices eased slightly due to new crop arrivals in Europe.
In contrast, prices for cereals, dairy, and sugar declined. The FAO Cereal Price Index fell to its lowest in nearly five years, reflecting seasonal supply pressures from Northern Hemisphere wheat harvests.
Its standalone rice index declined by 1.8% in the past month, reflecting abundant export availability and subdued import demand.
Meanwhile, the surge in meat prices was record-breaking, with the FAO Meat Price Index reaching 127.3 points, up 1.2% from the previous month.
Strong import demand from China and the United States fueled the rise, particularly for beef and sheep meat. U.S. beef imports spiked following drought-related declines in domestic cattle herds, while China’s growing appetite for beef pushed its import volumes to record highs.
Dairy prices dipped for the first time since April 2024, while sugar prices dropped for a fifth consecutive month amid expectations of increased production in Brazil and India.
Despite the July spike, the overall index remains 18.8% below its March 2022 peak, which followed the onset of the war in Ukraine.
FAO did not update its cereal supply and demand estimates this month.
As global markets grapple with inflation and supply chain disruptions, the FAO’s latest figures underscore the significant volatility in food commodity pricing and the growing pressure on consumers worldwide.
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