World food prices appear to be stabilizing, with values down only slightly in October after holding mainly steady in September.
The Food and Agriculture Organization (FAO) of the United Nations reported Friday that its food price index averaged 120.6 points in October, down 0.5% from September and now almost 11% below a year earlier. The index - which tracks monthly changes in the international prices of a set of globally traded food commodities - reached its all-time peak in March 2022 following the Russian invasion of Ukraine at 159.3 points, roughly 24% above current levels.
The index remained broadly stable in September, as declines in vegetable oil, dairy, and meat prices were offset by a notable increase in those for sugar and corn. In August, the index was 2.1% lower compared to July.
For October, dairy saw the only month-over-month price increase, with cereals, vegetable oils, sugar, and meat all a bit lower.
The FAO cereal price Index declined by 1% in October, as international rice prices dropped by 2% and wheat prices slipped 1.9%. The decline in wheat prices was attributed to heavy US supplies and strong competition among exporters – most notably Russia. By contrast, quotations for coarse grains rose slightly, led by corn due to thinning supplies in Argentina.
The vegetable oil index fell 0.7% from September with lower world palm oil prices - due to seasonally higher outputs and subdued global import demand - more than offsetting higher prices for soy, sunflower and rapeseed oils. The FAO attributed the strength in soy oil prices to “robust demand from the biodiesel sector.”
Meanwhile, the October sugar price index was down 2.2% from September but still nearly 47% above last year. The monthly decline in sugar was mainly driven by a strong pace of production in Brazil, although concerns over a tighter global supply outlook in the year ahead capped the drop, the FAO said.
The meat price index eased 0.6%.
In contrast, the dairy index gained 2.2% in October to end a nine-month decline.
