The benchmark for world food commodity prices saw its fastest increase in 18 months in September, with quotations up for all covered commodity groups, led by sugar, according to a report from the Food and Agriculture Organization of the United Nations (FAO) released on Friday.
The FAO Food Price Index, which tracks monthly changes in international prices for a range of traded food commodities, averaged 124.4 points in September. This reflects a 3.0 percent increase from August and a 2.1 percent rise compared to the same month last year.
According to the report, the FAO Sugar Price Index registered the largest increase in September, rising by 10.4 percent. This was driven by worsening crop prospects in Brazil and concerns that India’s decision to lift restrictions on sugarcane use for ethanol production may affect export availabilities from the country.
The FAO Cereal Price Index also rose by 3.0 percent in September, primarily driven by increased export prices for wheat and maize. International wheat prices went up due to concerns over excessively wet weather in Canada and the European Union, though this was somewhat mitigated by competitively priced supplies from the Black Sea region. Global maize prices increased as well, affected by low water levels on crucial transportation routes along Brazil’s Madeira River and the Mississippi River in the United States. In contrast, the FAO All Rice Price Index saw a slight decrease of 0.7 percent, attributed in part to generally subdued trading activity.
The FAO Vegetable Oil Price Index rose by 4.6 percent from August, with price increases across the board for palm, soy, sunflower, and rapeseed oils. The uptick in international palm oil prices was due to lower-than-expected production in major Southeast Asian producing nations, while the rebound in soyoil prices resulted mainly from reduced crushing volumes in the United States.
The FAO Dairy Price Index increased by 3.8 percent in September, with price rises noted for whole milk powder, skim milk powder, butter, and cheese.
Lastly, the FAO Meat Price Index rose by 0.4 percent, primarily due to higher poultry prices driven by strong import demand for Brazil’s meat products. Prices for bovine and pig meat remained stable, while ovine meat prices experienced a slight decline from August levels.
