World food commodity prices eased slightly in May as lower corn and palm oil values offset gains in beef and butter.
The Food and Agriculture Organization (FAO) of the United Nations on Friday reported its food price index - which tracks monthly changes in the international prices of a set of globally traded food commodities - averaged 127.7 points in May, down 0.8% from April but still 6% higher than a year earlier.
A sharp fall in corn prices helped drag down the FAO cereal price index, which dropped 1.8% in May. Strong harvests and “robust availability” in Argentina and Brazil, along with expectations for a record crop in the US, weighed on corn prices, the FAO said. World wheat prices also slipped in May, pressured by improving crop conditions in the northern hemisphere. On the other hand, the rice index increased by 1.4% last month.
The FAO vegetable oil price index dropped by 3.7% from April, with quotations down for all major oils. International palm oil prices declined markedly primarily due to seasonal output and availability increases in Southeast Asia. Meanwhile, global soy oil prices were impacted by higher supplies in South America and subdued demand for biofuel feedstock, while rapeseed oil prices eased on improved supply prospects in the European Union. Sunflower oil prices fell due to weakening global import demand and reduced price competitiveness, the FAO said.
In contrast, the FAO dairy price Index rose by 0.8% in May, with strong demand from Asia keeping international butter prices at historic highs and spurring higher prices for cheese and whole milk powder.
The meat price index increased by 1.3% from its revised April level because of higher quotations for beef, pork and sheep meat, with beef reaching a new historic high. However, poultry meat prices declined.
The FAO’s sugar index dropped 2.6% in May amid concerns over the uncertain world economic outlook, possible weaker demand from the beverage and food processing industries, and expectations of a recovery in global production next season.
The FAO food price index reached its all-time high of 160.2 points in March 2022 in the aftermath of the Russian invasion of Ukraine.
