The benchmark for world food
commodity prices declined in December compared to the previous month, with the
sharpest drop in international sugar quotations, the Food and Agriculture
Organization of the United Nations (FAO) has reported.
The FAO Food Price Index, which
tracks monthly changes in the international prices of a set of globally-traded
food commodities, averaged 118.5 points in December, down 1.5 percent from
November and down 10.1 percent from December 2022.
For 2023 as a whole, the index
was 13.7 percent lower than the average value over the preceding year, with
only the international sugar price index higher over the period.
The FAO Cereal Price Index
increased 1.5 percent from November, as wheat, maize, rice, and barley prices
all rose, partly reflecting logistical disruptions that hindered shipments from
major exporting countries. For the year as a whole, the index was 15.4 percent
below the 2022 average, reflecting well supplied global markets, although FAO’s
All Rice Price Index (part of the FAO Cereal Price Index) registered a 21
percent increase, largely owing to concerns about the impact of El Niño on rice
production and in the aftermath of export restrictions imposed by India.
The FAO Vegetable Oil Price Index
by contrast, declined by 1.4 percent from November, reflecting subdued
purchases of palm, soy, rapeseed, and sunflower seed oil, with soy oil in
particular impacted by a slowdown in demand from the biodiesel sector as well
as improving weather conditions in major growing areas of Brazil. For 2023 as a
whole, this index was 32.7 percent below the previous year’s level.
The FAO Sugar Price Index
declined 16.6 percent from November, hitting a nine-month low although still up
14. 9 per cent from December 2022. The plunge in sugar quotations was mainly
driven by the strong pace of production in Brazil, along with reduced use of
sugarcane for ethanol production in India.
The FAO Meat Price Index dipped
1.0 percent from November, reaching a level 1.8 per cent below that of December
2022, impacted by persistent weak import demand from Asia for pig meat.
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