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In September, global food commodity prices rose to their highest level in 18 months due to increasingly uncertain weather conditions in major production areas.
The Food and Agriculture Organization (FAO) reported that the food price index, which tracks the monthly changes in prices of a range of global food commodities traded internationally, averaged 124.4 points last month. This figure represents a 3% increase compared to August and a 2.1% rise year-on-year. However, the index still remains below the all-time high of 159.3 points recorded in March 2022, following Russia’s invasion of Ukraine.
Sugar prices surged by 10.4%, reaching their highest level, with this increase followed by rises in a range of products including grains and vegetable oils. The FAO’s cereal price index rose by 3% in September, driven largely by the increase in Export prices for wheat and corn.
International wheat prices were influenced by growing concerns over excessive rainfall in Canada and the European Union, although competitive prices from the Black Sea region partly offset these worries. In France, the largest wheat producer in the EU, the estimated drop in harvests could reach up to 25%, marking one of the worst harvests in the past 25 years due to persistent rains negatively affecting both yield and quality.
The rise in corn prices can be attributed to rainfall shortages in the United States, particularly along the Mississippi River, and in Brazil along the Madeira River. The drop in river levels has made it more difficult and costly to transport goods for Export.
In contrast to the increases in wheat and corn prices, the FAO’s overall rice price index experienced a slight decline of 0.7% in September, reflecting generally subdued trade.
The FAO’s vegetable oil price index increased by 4.6% compared to August, driven by high demand for palm, soybean, sunflower, and canola oils. The rise in international palm oil prices was primarily due to lower-than-expected production in Southeast Asia’s main producing countries, while the recovery in soybean oil prices was mainly due to lower-than-anticipated crushing activities in the United States.
The sharp increase in the sugar price index was attributed to worsening crop expectations due to drought conditions in Brazil and concerns over how India’s decision to lift restrictions on sugarcane usage for ethanol production might impact its Export opportunities.
In September, the FAO’s dairy price index rose by 3.8%, while the meat index saw a slight increase of 0.4%.
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Source: Tarım Haberleri
John Peterson graduated with a degree in Agricultural Sciences from Wageningen University in the Netherlands. His specialization is in sustainable crop production and soil health management. John is passionate about integrating modern technology with traditional farming methods to enhance productivity while preserving the environment. He currently works as a consultant, helping farmers adopt sustainable practices.
