World Food Prices Lower in August

DanEconomy, This Land of Ours

World food prices were lower last month. That’s coming up on This Land of Ours.

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The UN’s Food and Agriculture Organization’s Food Price Index averaged 121.4 points in August, a 2.6-point drop from July, reversing the rebound registered that month. The August drop pushed the index 38 points lower than its peak reached in March 2022. The overall drop was driven by declines in the index for dairy products, vegetable oils, meat, and cereals, while the sugar price index rose modestly.

The Dairy Price Index averaged 111.3 points in August and took the biggest drop, down 4.6 points from July, the eighth-straight monthly decline. The Vegetable Oil Index averaged 125.8 points, 4.6 points below July.. The Sugar Price Index averaged 148.2 points in August, up 1.9 points from July and as much as 37.7 points, or 34 percent, from its level in the same month last year.

From the National Association of Farm Broadcasting.

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World Food Prices Lower in August

FAO Food Price Index drops in August, reversing the slight rebound of the previous month

» The FAO Food Price Index* (FFPI) averaged 121.4 points in August 2023, down 2.6 points (2.1 percent) from July, reversing the rebound registered last month and pushing the index as much as 38.3 points (24.0 percent) below its peak reached in March 2022. The drop reflected declines in the price indices for dairy products, vegetable oils, meat and cereals, while the sugar price index increased moderately.

» The FAO Cereal Price Index averaged 125.0 points in August, down 0.9 points (0.7 percent) from July and standing 20.6 points (14.1 percent) below its value a year ago. International wheat prices fell by 3.8 percent, mostly reflecting higher seasonal availability from ongoing harvests in several leading exporters in the northern hemisphere. International coarse grain prices also declined in August by 3.4 percent. Maize prices fell for the seventh consecutive month, hitting their lowest value since September 2020, underpinned by ample global supplies from a record harvest in Brazil and the start of the harvest in the United States of America. Among other coarse grains, world prices of sorghum declined in August, pressured by the start of the harvest in the United States of America, the world’s largest sorghum exporter, while world barley prices firmed slightly. By contrast, the FAO All Rice Price Index in August rose by 9.8 percent month-on-month to reach a 15-year nominal high, reflecting trade disruptions registered in the aftermath of India’s July ban on Indica white rice exports. Against a backdrop of seasonally tight availabilities ahead of new-crop harvests, uncertainty over the ban’s duration and concerns that export restrictions would be extended to other rice types caused supply-chain actors to hold on to stocks, re-negotiate contracts or stop making price offers, thereby limiting most trade to small volumes or to previously concluded sales.

» The FAO Vegetable Oil Price Index averaged 125.8 points in August, down 4.0 points (3.1 percent) month-on-month after a short-lived increase in July. The decline reflected lower world prices across palm, sunflower, soy and rapeseed oils. International palm oil prices fell moderately in August, mainly underpinned by subdued global import purchases as well as seasonally rising outputs in leading producing countries in Southeast Asia. In the meantime, world prices of sunflower oil declined by nearly 8 percent from the previous month amid weakening import demand that coincided with abundant offers from major exporters. As for soy and rapeseed oils, world prices dropped due to improving soybean crop conditions in the United States of America and ample global exportable supplies, respectively.

» The FAO Dairy Price Index averaged 111.3 points in August, down 4.6 points (4.0 percent) from July, marking the eighth consecutive monthly decline, and as much as 32.1 points (22.4 percent) below its corresponding value last year. In August, international prices across all dairy products declined, with whole milk powder prices falling the most, influenced by abundant supplies especially from Oceania amid seasonally rising production, together with a slowdown in the pace of imports by China, although import volumes remained relatively high. Skim milk powder prices fell to their lowest level since mid-2020 due to subdued import demand and the lacklustre market activities associated with the summer holidays in Europe. Moreover, international butter and cheese prices dropped, reflecting similar factors coupled with steady production schedules in Oceania.

» The FAO Meat Price Index* averaged 114.6 points in August, down 3.6 points (3.0 percent) from July and 6.5 points (5.4 percent) from its value a year ago. International prices of all meat types fell in August, with the steepest drop registered for ovine meat, principally underpinned by a surge in export availabilities, mainly from …..

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Sabrina Halvorson
National Correspondent / AgNet Media, Inc.

Sabrina Halvorson is an award-winning journalist, broadcaster, and public speaker who specializes in agriculture. She primarily reports on legislative issues and hosts The AgNet News Hour and The AgNet Weekly podcast. Sabrina is a native of California’s agriculture-rich Central Valley.