The Food and Agriculture Organization of the United Nations (FAO) has announced that the benchmark index of international food commodity prices rose in April for the first time in a year, as world prices of sugar, meat and rice increased.

The FAO Food Price Index, which tracks monthly changes in international prices of commonly traded food commodities, averaged 127.2 points in April, up 0.6 percent from March. At this level, the index was 19.7 per cent lower than in April 2022, but still 5.2 per cent higher than in April 2021.

The FAO Cereal Price Index averaged 136.1 points in April, down 2.4 points (1.7 percent) from March and as much as 33.5 points (19.8 percent) below its value one year ago. A decline in world prices of all major grains outweighed an increase in rice prices month-on-month. International wheat prices declined by 2.3 percent in April to their lowest level since July 2021, principally driven by large exportable availabilities in the Russian Federation and Australia. Favourable crop conditions in Europe, along with an agreement at the end of April allowing Ukrainian grains to transit through the European Union countries that had imposed import restrictions on grain from Ukraine earlier in the month, also contributed to the overall softer tone in markets. World maize prices also fell, by 3.2 percent in April, mostly driven by higher seasonal supplies in South America as harvesting continued and favourable prospects point to a record output in Brazil. Among other coarse grains, world prices of barley and sorghum also declined, by 4.3 percent and 0.3 percent, respectively, reflecting weak global demand and spillover from weakness in international maize and wheat markets. By contrast, sales to Asian buyers buoyed international rice prices during April. As a result, rice export quotations reversed most of the declines they registered in March 2023.

“It is important that we continue to track very closely the evolution of prices and the reasons for increases in prices. As economies recover from significant slowdowns, demand will increase, exerting upward pressure on food prices,” said FAO Chief Economist Maximo Torero. “At the same time, the increase in rice prices is extremely worrisome and it is essential that the Black Sea initiative is renewed to avoid any other spikes in wheat and maize,” he added.

The FAO Sugar Price Index rose 17.6 percent from March, reaching its highest level since October 2011, due to reduced productions expectations and outcomes in India, China, Thailand and the European Union caused by dry weather conditions as well as to a slow start of the sugarcane crop harvest in Brazil, along with higher international crude oil prices, which can increase demand for sugarcane -based ethanol.

The FAO Meat Price Index rose 1.3 percent during the month, driven primarily by higher pig meat quotations, followed by poultry prices, which increased amid Asian import demand and production curbs spurred by animal health issues. International bovine meat prices also increased due to a decline in cattle supplies for slaughter, especially in the United States of America.

The FAO Vegetable Oil Price Index declined by 1.3 percent in the month, registering its fifth consecutive monthly decline. World palm oil prices were stable, while quotations for soy, rapeseed and sunflower oils declined in step with seasonal harvest pressure from a potentially record soybean crop in Brazil.

The FAO Dairy Price Index dropped by 1.7 percent, impacted by the persistent slack global import demand for milk powders and higher cheese export availabilities in Western Europe.