Food Price Index continues to climb

FAO’s Food Price Index* rose for the third consecutive month in July, to average 178.1 points – it’s highest level since January 2015. This puts the Index 3.9 points (2.3%) above June, and 16.6 points (10.2%) higher than where it was this time last year.

Higher cereal, sugar and dairy prices assisted the overall increase, which were driven by tight supplies and currency movements. Meanwhile, the Meat Index remained similar to the previous month and vegetable oil values declined.

The FAO Meat Price Index was 175.1 points in July – relatively unchanged from June, but 8.2% higher year-on-year. A lift in international ovine prices during the month was offset by lower bovine, pig and poultry meat values.

FAO suggests the decline in bovine meat prices was attributed to weaker import demand from the US, as beef production there recovers. Strong consumer demand has supported pig and poultry meat values, while reduced export availability from the Oceania region has seen ovine meat prices push higher for the fourth month in a row.

*The Food and Agriculture Organisation (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).