The benchmark for global food commodity prices rose in February, propelled by increases in sugar, dairy, and vegetable oil prices, according to the new Food and Agriculture Organization of the United Nations (FAO) report released today.
The FAO Food Price Index (FFPI) averaged 127.1 points in February 2025, up 2.0 points (1.6 percent) from its revised January level. While the meat price index remained stable, all other price indices rose, with the most significant increases recorded for sugar, dairy and vegetable oils. The overall index was 9.7 points (8.2 percent) higher than its corresponding level one year ago; however, it remained 33.1 points (20.7 percent) below the peak reached in March 2022.
The FAO Sugar Price Index averaged 118.5 points in February, up 7.3 points (6.6 percent) from January after three consecutive monthly declines. However, it remained 22.2 points (15.8 percent) lower than its level in February of last year. The increase in world sugar prices was driven by concerns over tighter global supplies in the 2024/25 season. Declining production prospects in India and concerns over the impact of recent dry weather on the upcoming crop in Brazil, which exacerbated the seasonal effect, underpinned the increase in prices. Additionally, the strengthening of the Brazilian real against the United States dollar, which tends to affect exports from Brazil, further contributed to the overall increase in global sugar prices.
According to the report, the FAO Dairy Price Index stood at 148.7 points in February, rising by 5.7 points (4.0 percent) from January and standing 28.0 points (23.2 percent) higher than its level a year ago. The increase was driven by higher prices across all major dairy products. International cheese prices increased for the third consecutive month, rising by 4.7 percent from January. The rise was fueled by strong import demand, as recovering production in Europe was offset by seasonal output declines in Oceania. Quotations for whole milk powder also increased, up 4.4 percent from January, underpinned by robust demand despite stagnating production in Oceania. International butter prices rebounded, rising by 5.2 points (2.6 percent) month-to-month, as declining milk output in Oceania, following seasonal patterns, coincided with strong domestic and international demand. Prices of skim milk powder registered a modest 1.8-percent increase month-to-month, as seasonally higher production in Europe was offset by declining production in Oceania.
The FAO Vegetable Oil Price Index averaged 156.0 points in February, up 3.0 points (2.0 percent) from the previous month and as much as 35.1 points (29.1 percent) above its level a year earlier. The increase in the index was driven by higher quotations across palm, rapeseed, soy and sunflower oils. After a brief decline in January, international palm oil prices rebounded moderately and maintained their premiums over competing oils. The increase was largely underpinned by seasonally lower outputs in Southeast Asian producing countries and expectations of increased demand from the biodiesel industry in Indonesia. Meanwhile, global soyoil prices increased on firm global demand, particularly from the food sector. In the case of sunflower and rapeseed oils, prices were mainly supported by concerns over likely tightening supplies in the coming months, the report further added.
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