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Informist, Friday, May 2, 2025

 

MUMBAI – The UN Food and Agriculture Organization's Food Price Index rose 1% to 128.3 points in April as increases in indices of cereal, dairy and meat prices outweighed the decreases in those of sugar and vegetable oils. The index was 7.6% higher than a year ago in April but still 19.9% below 160.2 points touched in March 2022, the organisation said in a report.

 

The Sugar Price Index averaged 112.8 points in April, down 3.5% from March and marking the second consecutive monthly decline. It fell 10.9% from a year ago. The drop in world sugar prices was largely driven by concerns over the uncertain global economic outlook and its potential impact on demand from the beverage and food processing sectors, which account for the bulk of global sugar consumption, the organisation said. 

 

Larger-than-expected sugar output in Brazil in the second half of March added further downward pressure. Furthermore, the depreciation of the Brazilian real against the US dollar and lower international crude oil prices contributed to the decline in world sugar prices, it said.

 

The Vegetable Oil Price Index fell 2.3% on month but rose 20.7% on year to 158.0 points in April. The on-month decline was mainly driven by lower palm oil prices, which more than offset higher soy and rapeseed oil quotations, while global sunflower oil prices remained largely stable, according to the organisation. After two months of increases, international palm oil prices fell markedly in April, largely underpinned by a gradual recovery in global export supplies due to seasonally higher outputs in major Southeast Asian producing countries. 

 

Meanwhile, world soy and rapeseed oil prices continued to rise, broadly reflecting, respectively, persistently firm global import demand and tightening supplies as the 2024-25 season nears its end. International sunflower oil prices, however, fluctuated within a narrow range during April but remained well above their year-ago levels, amid shrinking supplies out of the Black Sea region, it said.

 

The Meat Price Index was at 121.6 points in April, up 3.2% on month and 4.3% on year, higher quotations in the European Union due to stronger global import demand, following the reinstatement of Germany's foot-and-mouth disease-free status and the lifting of related restrictions by importers, further bolstered by increased seasonal demand associated with Easter holidays.

 

International meat quotations rose across all categories, with pig meat prices registering the most significant increase.

 

Meanwhile, Bovine meat prices also firmed, particularly in Australia and Brazil, amid steady import demand and limited global availability. Ovine meat prices surged as well, reflecting strong buying interest from key markets. In addition, poultry meat prices rose moderately, especially in Brazil, where robust external demand and festivity-related processing slowdowns tightened exportable supplies and added upward pressure on prices, FAO said.

 

The Cereal Price Index averaged 111.0 points in April, up 1.2% on month but 0.5% down on year. The monthly increase can be attributed to higher prices across all major cereals. Global wheat prices rose marginally, supported by tightening exportable supplies in the Russian Federation, a steady export pace from some major exporters, and currency movements linked to a weaker US dollar, particularly against the euro, the organisation said.

 

However, trade policy developments and macroeconomic uncertainty limited the rise. International maize prices also increased, largely due to seasonally tighter stock levels in the US and currency movements. Adjustments to the US import tariff policies, including the exemption of Mexico, the leading importer of US maize and a 90-day pause on import tariffs above 10% for several other trading partners, further contributed to the upward price pressure.

 

The organisation said that among other coarse grains, world prices of sorghum and barley also increased. Meanwhile, the FAO All Rice Price Index increased by 0.8% in April as demand for fragrant varieties strengthened and the arrival of freshly harvested supplies reduced in Vietnam, as the country's main crop harvest entered its final stage.

 

The Dairy Price Index rose 2.4% on month to 152.1 points in April and rose 22.9% on a yearly basis, the organisation said in its monthly report. International butter prices rose for the third consecutive month to a new all-time high, with a 2.9% on-month increase. The surge was largely driven by higher European prices supported by reduced inventories and strong milkfat demand, despite seasonally higher milk production. 

 

Meanwhile, international prices of cheese increased by 2.3% from March, driven by strong export demand amid tightening supplies in Oceania, the report said.  End

 

Reported by Taniva Singha Roy

Edited by Deepshikha Bhardwaj

 

 

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