The overall prices of global food commodities remained relatively stable in September, even though sugar prices surged to their highest point in nearly 13 years due to the influence of El Niño.
The FAO Food Index report, generated by the Food and Agriculture Organization of the United Nations, saw minimal change last month. Declines in vegetable oils, dairy, and meat prices balanced out the upticks in the sugar and cereal price indices.
The index registered a value of 121.5 points, representing a 10.7% decrease from the figure in the previous September and a 24% decline from the peak recorded in March 2022.
Sugar prices experienced a 9.8% increase compared to August, marking the second consecutive monthly rise and reaching their highest point since November 2010.
The surge in prices can be largely attributed to growing concerns regarding a more constrained global supply outlook. Initial predictions of reduced production in Thailand and India are a consequence of “drier-than-normal” weather conditions linked to the ongoing El Niño event.
The FAO’s cereal index increased by 1% compared to the previous month, primarily driven by a 5.3% surge in international coarse grain prices. Maize prices saw a 7% uptick, attributed to robust demand for Brazilian exports, reduced farmer selling in Argentina, and higher barge freight rates in the United States.
The All Rice Price Index experienced a slight 0.5% decline month-on-month in September but still stood significantly higher at 27.8% above its value from the same time the previous year. This decrease is attributed to India’s decision to prohibit the export of non-basmati white rice in July, aimed at managing the surging prices.
Vegetable oil prices saw a 3.9% decrease compared to the previous month, driven by reduced global prices in palm, sunflower, soy, and rapeseed oils.
Dairy prices continued their decline for the ninth consecutive month, decreasing by 2.3%. Additionally, meat prices experienced a slight drop compared to August, primarily due to the decline in international pig meat prices.