World Food Price Index Hits 17-Month Low In May: UN
World food prices fell for a fourth consecutive month in May, hit by the economic fallout of the coronavirus pandemic which has stymied demand, the United Nations food agency said on Thursday.
The Food and Agriculture Organisation (FAO) food price index, which measures monthly changes for a basket of cereals, oilseeds, dairy products, meat and sugar, averaged 162.5 points last month, down 1.9% on April.
It was the lowest monthly reading since December 2018.
The dairy index dropped 7.3%, led by sharp falls in both butter and cheese, partly because of lower import demand.
The cereal price index slipped 1% as coarse grain prices continued their decline, with U.S. maize prices some 16% down on the year, and wheat export prices falling, amid expectations of ample global supplies. International rice prices edged higher.
Vegetable oil prices fell 2.8% to a 10-month low, while the meat index slipped 0.8%. Poultry and pig meat quotations continued to fall, reflecting high export availabilities and despite an increase in import demand in East Asia.
Bucking the general downward trend, the sugar price index jumped 7.4% in April largely because of lower-than-expected harvests in some major producers, notably India and Thailand.
Forecast - 2020 Cereal Season
FAO also posted its first forecast for the 2020 cereal season, foreseeing global output of 2.780 billion tonnes -- a 2.6% increase on 2019's record harvest.
The UN agency said maize would account for much of the expected increase, rising a predicted 64.5 million tonnes to 1.207 billion tonnes thanks to anticipated record harvests in the United States, Canada and Ukraine, and near-record harvests in Brazil and Argentina.
Rice production was seen reaching an all-time high of 508.7 million tonnes in 2020, up 1.6% on 2019.
By contrast, global production of wheat in 2020 was forecast to drop, largely on the back of likely falls in the European Union, Ukraine and the United States, which would offset expected increases in Russian and Australia, FAO said.