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National & World Ag News Headlines |
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FAO Food Price Index Drops to Nearly 7-year Low
USAgNet - 02/08/2016
The United Nations' Food and Agriculture Organisation (FAO) Food Price Index fell in January, slipping 1.9 percent below its level in the last month of 2015, as prices of all the commodities it tracks fell, sugar in particular. The Food Price Index averaged
150.4 points in January, down 16 percent from a year earlier and registering its lowest level since April 2009.
The FAO Food Price Index is a trade-weighted index tracking international market prices for five key commodity groups: major cereals, vegetable oils, dairy, meat and sugar. The main factors underlying the lingering decline in basic food commodity prices are
the generally ample agricultural supply conditions, a slowing global economy, and the strengthening of the US dollar.
This month, FAO also raised its forecast for worldwide cereal stocks in 2016, as a result of lowering its projected consumption and raising 2015 production prospects.
The Dairy Price Index dropped by 3.0 percent on the back of large supplies, in both the EU and New Zealand, and torpid world import demand. The Meat Price Index moved 1.1 percent lower than its revised December value, with prices of all meat categories
falling, except pigmeat, which was sustained by the opening of private storage aid in the EU.
Weather patterns associated with El Niño are sending mixed signals about the early prospects for cereal crops in 2016, especially in the Southern Hemisphere, according to FAO's Cereal Supply and Demand Brief, also released.
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