World food prices of key staple food commodities rose in April, marking its third consecutive monthly increase after four years of decline, the United Nations food agency said.
The increase was driven by palm oil prices and, in a minor key, cereals, while sugar prices tapered down after a strong increase in March, the Food and Agriculture Organization (FAO) said.
The FAO Food Price Index averaged 151.8 points in April, a 0.7 percent increase from March, about 10 percent below its level of a year ago and more than a third off its 2011 highs.
The FAO Food Price Index is a trade-weighted index tracking international market prices for five key commodity groups: major cereals, vegetable oils, dairy, meat and sugar. Its decline over the past year reflects ample food supplies, a slowing global economy and a stronger U.S. dollar.
The FAO Vegetable Oil Price Index rose 4.1 percent, due largely to a grim 2016 production outlook for palm oil coupled with a growing worldwide demand.
The Cereal Price Index rose 1.5 percent on the month, due primarily to international maize quotations, themselves influenced by a weaker U.S. dollar and spillover from the oilseeds complex. However, rice prices declined marginally, while wheat markets posted limited gains amid expectations of large supplies in the new season for the crop.
The Dairy Price Index dropped 2.2 percent as stocks of butter and cheese in major exporters continued to grow.
The Meat Price Index rose 0.8 percent, pushed up by strengthening U.S. demand for Australian beef, while the Sugar Price index dropped 1.7 percent in April after a dramatic 17 percent increase the previous month.
FAO said while concerns about global sugar production remain, Brazil – by far the main exporter – has had its second-highest crop ever and the country’s use of sugarcane for ethanol is expected to decline.
Sugar and vegetable oils are the only sub-indexes currently at levels higher than those of April 2015.