Food Price Index registers small increase – FAO

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The United Nations Food and Agricultural Organisation (FAO) Food Price Index* averaged 156.3 points in September – a slight increase (up 1 point) from its sharp decline in August, although still 36.4 points lower than the same time last year. This is the first upward movement for the Index in over 12 months.

The upturn was partly attributed to a lift in the Dairy Price Index, compared to the previous month, associated mainly with higher quotations from New Zealand, as producers decrease production due to earlier low dairy payouts. A rise in the Sugar Price Index also assisted the overall increase, as heavy rain across the major sugarcane-producing regions of Brazil, as well as below-average monsoon rain in India, negatively impacted cane harvest and yield during September.

The Meat Price Index averaged 170.5 points in September – marginally lower than the previous month, and, like all other commodity indices, well-below (40.5 points) year-ago levels.

Since March, the Meat Price Index has moved within a fairly narrow range. During this period, poultry prices have declined due to lower feed costs, while the combination of strong demand and limited supplies saw bovine prices increase. Pigmeat quotations have remained relatively stable over the seven-month period, while ovine prices have varied, partly reflective of seasonal supply in different growing regions around the world.

*The FAO Food Price Index is a measure of the monthly change in international prices of a basket of food commodities. It consists of the average of five commodity group price indices, weighted with the average export shares of each of the groups for 2002-2004 (Food and Agriculture Organisation of the United Nations).