World food prices continue to rise, reaching an almost seven – year high Food news

The Food and Agriculture Organization’s food price index, which measures monthly changes for a basket of cereals, oilseeds, dairy, meat and sugar, averaged 118.5 points last month versus a slightly revised 116.1 in February.

World food prices rose for the tenth month in a row in March, reaching their highest level since June 2014, led by jumps in vegetable oils, meat and dairy indices, the United Nations Food Agency announced on Thursday.

The Food and Agriculture Organization’s food price index, which measures monthly changes for a basket of cereals, oilseeds, dairy products, meat and sugar, averaged 118.5 points last month, compared to a slightly revised 116.1 in February.

The figure for February was previously given as 116.0.

The Rome-based FAO also said the world’s grain harvest is still on track to reach an annual record in 2020, adding that early indications indicated a further increase in production this year.

The FAO cereal price index fell 1.7 percent month-on-month in March, ending eight months in a row, but still 26.5 percent higher than the same period last month.

Among the major cereals, wheat export prices fell the most, falling 2.4 percent a month, reflecting good stocks and encouraging prospects for 2021 crop production, the FAO said.

The FAO’s vegetable oil price index rose 8 percent monthly to reach its highest level since June 2011, elevated by higher prices of palm, soybean, canola and sunflower oil.

Dairy prices rose for the tenth month in a row, recording a 3.9 percent rise. The FAO said that one of the drivers of this sector is milk powder, which has been affected by a sharp rise in imports to Asia, especially China, due to concerns about short-term stocks.

The meat index rose 2.3 percent, but unlike all other indices, it still fell slightly year-on-year. The FAO said that the quotations of poultry and pork have increased, supported by the fast pace of Asian countries, mainly China.

Sugar prices fell 4 percent month on month, but were still up 30 percent year-over-year. The decline in March was driven by the prospect of large exports from India, the FAO said.

FAO has increased its forecast for the 2020 grain season to 2.765 billion tonnes from a previous estimate of 2.761 billion, indicating a 2 per cent year-on-year growth.

Looking ahead, the FAO said it expects world grain production to increase for the third year in a row in 2021.

Global wheat production reached a new high of 785 million tonnes this year, 1.4 percent higher than in 2020, driven by the expected sharp jump in much of Europe and expectations of a record harvest in India, the FAO said.

Above-average corn products were also expected, with a record harvest forecast for Brazil and a multi-year high for South Africa.

For the current marketing season 2020-21. Global cereal use is projected at 2.777 billion tonnes, up 2.4 per cent from the previous year, largely thanks to higher estimates of wheat and barley food use in China, where the livestock sector is recovering from African swine fever.

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