For the first time in 12 months, global food commodity prices dropped in the month of June. The FAO Food Price Index, which tracks changes in the international prices of the most globally traded food commodities, averaged 124.6 points in June 2021, down 2.5% from May.
The plunge in June reflected decline in the prices of vegetable oils, cereals and dairy products, which more than offset generally higher meat and sugar quotations.
The FAO Vegetable Oil Price Index decreased by 9.8 percent in the month, marking a 4-month low, while the Rome-based FAO’s Meat Price Index rose by over 2%.
Moving against the overall food price trend, FAO Sugar Price rose by 0.9 percent month-on-month. According to the UN food agency, uncertainties over the impact of non-favorable weather conditions on crop yields in Brazil exerted upward pressure on prices.
As per the latest Cereal Supply and Demand Brief, FAO’s forecast for worldwide cereal production in 2021 has been lowered marginally. Similarly, forecasts for world coarse grains production have been cut back too.
In contrast, the forecast of global rice production in 2021 has undergone an upward adjustment since June, with a record of 519.5 million tonnes of rice now likely to be harvested in 2021, up about 1 percent from 2020.