World Food Prices Ease
ROME - Dec 7/17 - SNS -- World food prices eased in November as lower dairy prices offset a sharp increase in sugar and vegetable oil quotations, according to the latest FAO Food Price Index.
The index averaged 175.8 points in November, down 0.5% from the previous month while still up 2.3% from a year earlier.
The November decline was driven by a 4.9% monthly drop in the FAO Dairy Price Index, as quotations for butter, cheese and whole and skim milk powders all fell.
By contrast, the FAO Sugar Price Index jumped 4.5% on the month, due mostly to a drop in exports from Brazil and concerns that firmer oil prices may lead more production to be used for producing ethanol.
The FAO Vegetable Oil Index also rose 1.2% during the month, led by higher soy oil prices, while palm oil values declined due to higher-than-expected stock levels in Malaysia. The FAO Meat Price Index was broadly unchanged as bovine meat prices rose and pigmeat quotations declined.
The FAO Cereal Price Index registered a small rise in November, led by a 1.1% increase in international rice quotations.
The STAT global pulse price index dropped sharply in November in response to India's decision to impose a 50% import duty on dry peas. It averaged 148.9 points, compared to 161.6 in October and 195.9 the same month last year.
Cereal Output and Stocks Rising
FAO sharply raised its forecast for global cereal production to 2,627 million metric tons (MT), some 13.4 million higher than its October projections, with the bulk of the increase mostly reflecting higher estimates for maize yields in the United States and a significant increase in maize plantings in Indonesia.
Global wheat production is now forecast at 754.8 million MT, while rice output is projected at 500.8 million MT, both just a notch below their 2016 record levels.
World cereal total utilization is now expected to increase by 1.2% in 2017-18 season, reaching 2,599 million MT, with more rice and wheat being destined for direct human consumption and more coarse grains used for feeding animals.
World cereal inventories are set to rise to a record-high 726 million MT, according to the latest FAO projection. Global wheat and maize stocks are both expected to reach record levels.
Large stocks are seen to lift the global cereal stock-to-use ratio to 27.3% by the end of the 2017-18, its highest level in 16 years.
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