Global food prices fall for 5th month in August, says UN agency

The United Nations food agency’s world price index fell for a fifth straight month in August after hitting record highs earlier this year, as the resumption of grain exports from Ukrainian ports helped improve supply prospects.

The Food and Agriculture Organization of the United Nations (FAO) said this Friday (2) that its price indexwhich tracks the most traded food commodities globally, averaged 138.0 points last month, down from 140.7 in July.

The July number had previously been calculated at 140.9.

The index fell from a record 159.7 in March, hit after Russia’s invasion of Ukraine. The August reading was, however, 7.9% higher than the previous year.

The FAO cereal price index fell 1.4% month-on-month in August, as the reopening of Ukrainian Black Sea ports under a diplomatic agreement, as well as favorable wheat harvest prospects in North America and Russia weighed on prices, the agency said.

But the corn price index rose 1.5% last month as hot, dry weather dampened production prospects in Europe and the United States, he said.

Price indices for vegetable oils, sugar, dairy products and meats fell, in part reflecting improved supply.

In separate estimates of cereal supply and demandFAO lowered its forecast for global cereal production in 2022 to 2.774 billion tonnes, from a previous projection of 2.792 billion in early July.

This is 1.4% below the estimated production for 2021.

The forecast for cereal production in 2022 has been cut due to the reduced outlook for maize due to weather in the Northern Hemisphere, with EU yields falling 16% below the five-year average, the FAO said.