Global commodity food prices fell for the fourth consecutive month in May, as supplies appear strong and demand weakens due to economic contractions triggered by the COVID-19 pandemic, the Food and Agriculture Organization (FAO) of the United Nations reported today.
The FAO Food Price Index, which tracks international prices of the most commonly-traded food commodities, averaged 162.5 points in May, 1.9 percent below the previous month and marking its lowest reading since December 2018.
The FAO Dairy Price Index declined 7.3 percent from April, led by steep drops in the quotations for butter and cheese due to seasonal supply factors and lower import demand, and averaged 19.6 percent below its level one year ago. Quotations for milk powders declined only moderately, as low prices and renewed economic activity in China fueled strong buying interests.
The FAO Sugar Price Index bucked the trend, rising 7.4 percent from the previous month and undoing half of its April decline due to a rebound in international crude oil prices as well as lower-than-expected harvests in India and Thailand, respectively the world’s second-largest sugar producer and second-largest exporter.
The FAO Cereal Price Index declined 1.0 percent from April. International rice prices edged up slightly, buoyed by rising Japonica and Basmati quotations, while wheat export prices fell, amid expectations of ample global supplies. Coarse grain prices fell further, with U.S. maize prices now almost 16 percent below their level of May 2019.
The FAO Vegetable Oil Price Index fell 2.8 percent to a 10-month low. While quotations for rapeseed and sunflower oil prices increased, those for palm oil fell for the fourth consecutive month, reflecting subdued global import demand and higher-than-expected production and inventory levels in major exporting countries.
The FAO Meat Price Index declined by 0.8 percent in May, averaging 3.6 percent below its May 2019 value. Bovine meat quotations increased while those for poultry and pig meats continued to fall, reflecting high export availabilities in major producing countries, despite an increase in import demand in East Asia following the relaxation of COVID-19 social distancing measures.