Staple food prices rose in August even as grain prices fell and the outlook for global cereal production improved.
The FAO Food Price Index, released today, averaged 165.6 points in August, up 1.9 percent from July and almost 7 percent from a year earlier. The monthly jump was mostly driven by cheese and palm oil quotations, while those for wheat, maize and rice all fell.
Price trends resume upward path
FAO's trade-weighted index-tracking international market prices for five major food commodity groups, reversed its July drop and rose in August to its highest level in 15 months.
The FAO Dairy Price Index rose 8.6 percent during the month, confirming a notable change in market sentiment linked to falling milk production in the E.U. and a tightening of export supply prospects after an unexceptional opening to the dairy year in Oceania.
The FAO Vegetable Oil Price Index rose 7.4 percent during the month, driven by stronger palm oil prices due to lower than anticipated output from Malaysia and rising import demand by China, India and the EU.
The FAO Sugar Price Index, now at its highest level in almost six years, rose 2.5 percent from July and is now as much as 75 percent above its year-ago level. A stronger currency in Brazil, by far the world's largest producer of sugar cane, drove much of the gain as it limited export supplies with producers preferring to sell to the local markets.
The FAO Meat Price Index was broadly stable, rising 0.3 percent from July even as bovine meat quotations declined. Abundant coarse grain feeds drove a recovery in U.S. beef supply.
Reflecting cereal grain crop trends and prospects, the FAO Cereal Price Index declined by 3.0 percent from July and is 7.4 percent below its August 2015 level.
Thursday september 8, 2016/ FAO.