Food prices kept falling in June

The reference index for international prices of basic food products fell again in June, led by the decline in the prices of the main cereals and most types of vegetable oils, according to reported this Friday the Food and Agriculture Organization of the United Nations (FAO).

This FAO index, which records the monthly variations in international prices of the most traded food products, reached an average of 122.3 points in June, 1.4% less than in May and 23.4% less than its maximum in March 2022.

Variations by food

The price index for cereals it fell 2.1% compared to May. International quotations for coarse grains decreased by 3.4% in June, driven mainly by increased supplies of maize from the ongoing crops in Argentina and Brazil and improved production prospects in key producing areas of the United States. Joined.

The international prices of wheat they fell 1.3% as harvests began in the northern hemisphere, influenced by abundant supplies and lower export taxes in the Russian Federation, along with improving conditions in the United States. International rice prices decreased by 1.2%, due to subdued demand for non-Indica varieties and Pakistan’s efforts to attract export sales.

As for the vegetable oils, prices fell 2.4% from May as lower world prices for palm and sunflower oils offset increases in soybean and rapeseed oil prices, influenced by weather conditions in the main producing regions .

The index of the dairy products The FAO prices decreased by 0.8% in June, driven by lower international cheese prices, although butter prices rose, driven by active demand, mainly from the Middle East.

The index of the sugar it decreased by 3.2%, its first decrease after four consecutive monthly increases, caused mainly by the good progress of the sugar cane harvest in Brazil and the slack global demand for imports, particularly from China.

The prices of the meat they were broadly unchanged in June, with prices for poultry rising on strong import demand from East Asia amid ongoing supply problems related to widespread outbreaks of bird flu. International pigmeat prices also rose, while those of bovine and ovine meat fell due to the increase in exportable availabilities from Oceania.

Cereal production forecast to reach record high

According to the last report The agency’s grain supply and demand report, also published on Friday, is expected to world cereal production reaches a record in 2023 and 2024.

Specifically, the FAO raised its forecast for world cereal production for 2023 to 2,819 million tons, which represents a 1.1% increase over the previous year.

The increased forecasts almost entirely reflect better prospects for world wheat production, now at 783.3 million tonnes, thanks to improving circumstances in several countries including Canada, Kazakhstan and Turkey. However, world wheat production is still 2.3% lower than the previous season.

The FAO raised its forecast for world cereal reserves at the end of the 2023/24 season to 878 million tons, 2.3% more than in the previous season. At this level, the ratio of world grain reserves to utilization would remain unchanged at 30.6%, “indicating some good supply prospects in the new season“.

High food prices worsen the food situation in vulnerable countries

On the other hand, the agency notes that high food prices, economic recession, conflicts, droughts and the imminent risk of El Niño weather events in various regions are exacerbating concerns about food security in many parts of the world. world.

It is estimated that a total of 45 countries need foreign aid for foodaccording to the latest report Crop prospects and food situationa quarterly publication of FAO’s Global Information and Early Warning System on Food and Agriculture, also published this Friday.

High local food prices, which diverge from the FAO Food Price Index, are one of the Drivers of Worrying Hunger Levels in most of the 45 countries, 33 of which are in Africa, nine in Asia, and also Haiti, Ukraine and Venezuela.

While world cereal production is estimated to grow by 1.1% in 2023 compared to the previous year, is expected to contract in the group of 44 countries of Low Income and Food Deficits, pushing the import needs.

The quarterly report provides detailed information on food insecurity and price developments faced by people on the ground in affected countries. It also offers a detailed assessment of regional production and trade prospects around the world.