Global food prices decline in June, after rising for over 12months reports UN

A report released by the United Nations, mentions that the global commodity food prices have fallen for the first time in June in almost a span of one year. The report released by the benchmark body on Thursday, July 8 convenes that the FAO Food Price Index averaged 124.6 points in June. It performed down 2.5 per cent as compared to May, but still, it was around 33.9 per cent higher than its level, as calculated in the same period last year. It was the first time in over 12 months that the FAO food price index marked a decrease in June, after witnessing a consecutive monthly increase for over a year.

What is the FAO Food Price Index?

The role of the  FAO Food Price Index is to track changes in the international food prices, most of the majorly traded food commodities across the globe. It measures changes in the prices for cereals, oilseeds, dairy products, meat and sugar. It was introduced in 1996, to monitor developments in the global agricultural commodity markets, as a measure for the public good.

What does the drop in prices reflect?

The drop in prices in June suggests a decline in global food prices. It would mean that the prices of vegetable oils, cereals, might and other basic food commodities, including Dairy products, have declined globally.

Major Highlights from the Report

1. The FAO Vegetable Oil Price Index fell by 9.8 % in June.The drop in the prices reflects lower international prices of vegetable oils, mainly; palm, soy and sunflower oils.

2. The FAO Cereal Price Index fell by 2.6 % in May but remained 33.8% higher than its value last year.

3. The FAO Dairy Price Index fell by 1 per cent to 119.9 points. The report says, “International quotations for all dairy products represented in the index fell with butter registering the highest drop, underpinned by a fast decline in global import demand and a slight increase in inventories, especially in Europe”.

4. The FAO Sugar Price Index is in contrast to the overall food price trend, it has shown a monthly increase of 0.9% this year, for three months now and reached a new multi-year high. 

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