In May, the United Nations Food and Agriculture Organization reported a drop in world prices for food products.
This drop was mainly due to a significant reduction in the prices of cereals, sugar and vegetable oils.
Last month, the FAO food price index was 127.7 points, a slight drop of 0.8% or 1.0 points from April.
In particular, while the prices of dairy and meat products have seen increases, these have been offset by reductions in cereal, sugar and vegetable oil clues, according to the latest organization.
The food price index showed an increase of 6%, which is equivalent to 7.2 points compared to the previous year.
However, it is still 20.3%lower, which represents a decrease of 32.6 points, of its peak in March 2022, after the invasion of Ukraine by Russia.
Cereals
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In May, the FAO cereal price index recorded an average of 109.0 points, showing a decrease of 1.8% or 2.0 points compared to April.
In addition, it dropped by 8.2% or 9.7 points compared to the level observed in May 2024.
“World corn prices have decreased sharply over the month, under pressure by firm competition and the increase in seasonal availability of current harvests in Argentina and Brazil, with harvest in the two countries before last year’s pace by the end of May,” said the organization in the report.
Prices have also decreased, partly due to the anticipation of a record of corn in the United States in 2025.
Sorghum and barley, as well as other coarse grains, experienced a drop in world prices.
International wheat prices have also dropped, but to a lesser extent.
This moderate drop in wheat prices was awarded to weakened global demand and favorable culture conditions in the northern hemisphere.
On the other hand, May saw the price of FAO rice price increase by 1.4%. This increase was fed by a robust demand for aromatic rice types and an increase in indica rice prices.
The contributory factors included currency gains from the US dollar in certain exporting rice nations.
Vegetable oil
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In May, the FAO vegetable oil price index amounted to 152.2 points, a decrease of 3.7% or 5.8 points compared to April.
However, this figure remains 19.1% higher than the level recorded a year earlier.
“The continuous decline reflected lower quotes for palm, rapeseed, soy and sunflower oils,” said FAO.
The world prices of palm oil have experienced a significant drop in the second consecutive month, continuing to be lower than other comparable oils since mid-April.
The drop was mainly supported by larger seasonal outings and export availability in Southeast Asia.
The South American supply increases and reduced the demand for raw materials, especially in the United States, lowered world soy prices.
The reduction in rapeseed oil costs is mainly awarded to the expected increases in the offer with the next harvest of the European Union.
Meanwhile, sunflower oil prices have decreased due to the decrease in global demand for importing and reducing competitive prices.
Meat and dairy products
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Beef prices have reached a record level, contributing to an increase of 1.3% of the overall prices of meat since April.
The FAO meat price index was on average 124.6 points in May.
FAO said:
The increase was driven by higher international prices for cattle, sheep and pig meats, which has more than compensated for a drop in quotes from poultry meat.
Increases have also been observed for pork and sheep meat.
Global demand and status of German disease have increased pork prices, in particular German exports.
However, poultry prices have dropped due to the excess offer of Brazil, which was faced with import restrictions after a bird flu epidemic.
The FAO dairy price index was on average 153.5 points in May. Strong Asian demand propelled the FAO dairy price index by 0.8%.
The prices of butter remained stable at record levels, in parallel with the prices of cheese and whole milk powder.
