World food prices fall to lowest levels in 7 years
Global food prices in August dropped to their lowest levels since December 2008, the United Nations Food and Agriculture Organization (FAO) said in a statement released on Thursday.
The FAO said that ample supplies, a slump in energy prices and concerns over China's economic slowdown all contributed to the sharpest fall of the FAO Food Price Index in seven years. The index measures monthly changes for a basket of cereals, vegetable oils, dairy, meat and sugar. The index averaged 155.7 points in August 2015, down 5.2 percent from July, the steepest monthly drop since December 2008.
The cereal price index fell sharply by 15.1 percent from last year, a decline driven by falling wheat and maize prices that reversed two consecutive months of modest increases. Continued improvements in production for 2015 to 2016 were largely behind the cereal price slides, the statement said.
The sugar price index also fell sharply, down 10 percent from July to an average of 163.2 points in August. The FAO said that this was largely the result of the continued depreciation of the Brazilian real against the dollar and expectations that India, the world's second largest sugar producer, will become a net exporter in the current 2015-2016 season, the statement said.
The vegetable oil price index fell 8.6 percent from July and hit its lowest level since March 2009, partly driven by low international palm oil prices and also the result of slowing import demand, notably by India and China, according to the FAO.
However, meat prices in August remained the same as previous month. "Nevertheless, compared with the meat price index's historic peak in August 2014, overall prices were down by 18 percent," the FAO said.
The organization's latest "Cereal Supply and Demand Brief " also predicts that global wheat production output for 2015 will be 5 million tons more than previously expected at 728 million tons, mainly thanks to higher expectations for crops in Australia, the EU and Russia.
According to the FAO's latest upgraded forecasts, global rice production in 2015 will be 3.6 million tons, greater than in 2014.
The FAO forecast in August for global cereal production in 2015 stands at 2.54 million tons, 13.8 million tons more than expected in July, but still 21 million tons, or 0.8 percent, below the 2014 record.
The FAO said that ample supplies, a slump in energy prices and concerns over China's economic slowdown all contributed to the sharpest fall of the FAO Food Price Index in seven years. The index measures monthly changes for a basket of cereals, vegetable oils, dairy, meat and sugar. The index averaged 155.7 points in August 2015, down 5.2 percent from July, the steepest monthly drop since December 2008.
The cereal price index fell sharply by 15.1 percent from last year, a decline driven by falling wheat and maize prices that reversed two consecutive months of modest increases. Continued improvements in production for 2015 to 2016 were largely behind the cereal price slides, the statement said.
The sugar price index also fell sharply, down 10 percent from July to an average of 163.2 points in August. The FAO said that this was largely the result of the continued depreciation of the Brazilian real against the dollar and expectations that India, the world's second largest sugar producer, will become a net exporter in the current 2015-2016 season, the statement said.
The vegetable oil price index fell 8.6 percent from July and hit its lowest level since March 2009, partly driven by low international palm oil prices and also the result of slowing import demand, notably by India and China, according to the FAO.
However, meat prices in August remained the same as previous month. "Nevertheless, compared with the meat price index's historic peak in August 2014, overall prices were down by 18 percent," the FAO said.
The organization's latest "Cereal Supply and Demand Brief " also predicts that global wheat production output for 2015 will be 5 million tons more than previously expected at 728 million tons, mainly thanks to higher expectations for crops in Australia, the EU and Russia.
According to the FAO's latest upgraded forecasts, global rice production in 2015 will be 3.6 million tons, greater than in 2014.
The FAO forecast in August for global cereal production in 2015 stands at 2.54 million tons, 13.8 million tons more than expected in July, but still 21 million tons, or 0.8 percent, below the 2014 record.
Last Update: September 10, 2015 22:34