Global Food Prices Advance
ROME - Jul 7/16 - SNS -- Global food prices posted their largest increase in four years during June, rising 4.2% to average 163.4 points, according to the FAO. The June rise, which affected all commodity categories except vegetable oils, was the fifth consecutive monthly increase.
The price movement reflects FAO's updating of its cereal supply and demand forecasts for the 2016-17 marketing season. FAO's Food Price Index is a trade-weighted index tracking international market prices for key traded food groups.
The FAO Sugar Price Index rose 14.8% from May, as Brazil, the world's largest sugar producer and exporter, endured heavy rains that hindered harvesting and dented yields.
The FAO Cereal Price Index rose 2.9% in the month and is now 3.9% below its level of June 2015. Maize prices drove that increase, primarily due to tightening export supplies from Brazil. Ample wheat supplies and reports of record yields in the United States held down wheat prices.
The FAO Dairy Price Index rose 7.8% from May, spurred by an uncertain outlook in Oceania and slower production growth in the European Union. Nonetheless, the index remained 14% below its level of a year ago.
The FAO Meat Price Index rose 2.4% from its revised May value, as average quotations for pork, beef and poultry all rose for the third consecutive month.
The FAO Vegetable Oil Price Index defied the trend, declining 0.8% from its May level.
STAT Publishing Panama's world pulse price index dropped 4% from its May level, to average 237.8 points in June, compared to 184.7 during the same month last year. The decline in the global pulse price index reflected steep drops in average trading levels for Canadian pulses. That index dropped 10.7 points from May to average 234.8 in June, while the U.S. pulse price index slipped 0.8 points to average 151.1.
Bigger Cereal Crops
FAO's Cereal Supply and Demand Brief, also released today, pointed to improved production prospects primarily for wheat.
Global wheat production is now pegged at 732 million MT, more than one% higher than anticipated in June, mainly due to improved prospects in the EU, the Russian Federation and the U.S., as a result of better weather conditions.
The forecast for world maize production in 2016 was, however, cut down as prospects for the second crop in Brazil have dimmed and as reduced government support in China led to lower planting. Overall coarse grain production for this year is now expected to be 1 316.4 million MT, some 0.6% lower than last month's forecast.
World total cereal utilization in the 2016-17 marketing year, meanwhile, is now projected at 2 555.6 million MT, 1.3% higher than the estimate for 2015-16.
As a result, global cereal stocks by the end of farming season in 2017 are expected to stand at 635 million MT, 1.5% below their opening level. The resulting world stocks-to-use ratio for cereals would stand at 24.2% in 2016-17, compared to the 2007-08 historical low of 20.5%.
Only active subscribers can read all of this article.
If you are a subscriber, please log into the website.
If you are not a subscriber, click here to subscribe to this edition of the STAT website and to learn more about becoming a subscriber.
