According to a new report from the United Nations Food and Agriculture Organization (FAO), global food prices were almost unchanged in March. A significant jump in vegetable oil prices was balanced out by drops in the cost of cereals and sugar.
The FAO’s Food Price Index, which tracks the international prices of commonly traded food commodities, averaged 127.1 points last month. While this is 6.9% higher than a year ago, it remains significantly lower (20.7%) than the all-time high reached in March 2022.
A Breakdown by Food Category:
- Cereals (like wheat, corn, and rice): Prices fell by 2.6% from February. This was due to improved weather conditions for crops in key exporting countries and a strong supply of rice.
- Vegetable Oils (like palm and soy oil): Prices rose sharply by 3.7%, now almost 24% higher than last year. This increase is driven by strong international demand.
- Meat: Prices increased slightly (0.9%), mainly because of higher pork prices in Europe. Poultry prices stayed stable despite ongoing bird flu outbreaks.
- Dairy: Prices were unchanged overall. Lower cheese prices were offset by higher prices for butter and milk powder.
- Sugar: Prices dropped by 1.6%, primarily due to signs of lower global demand and good rainfall in Brazil, a major producer.
Updated Forecasts for Global Grain Supplies
FAO also released a new Cereal Supply and Demand Brief, with revised estimates for 2024 and fresh insights on cropping and crop prospects in 2025.
- Production: Global cereal production in 2024 is now estimated to be slightly lower than in 2023, but better-than-expected wheat harvests in Australia and Kazakhstan have improved the outlook.
- 2025 Outlook: The early forecast for 2025 global wheat production is unchanged and is expected to match 2024 levels. Harvests are predicted to grow in the European Union and India but decline in the United States and Australia.
- Stocks & Trade: The amount of cereals held in storage worldwide is expected to decrease slightly by the end of 2025. However, the overall supply level is still considered comfortable. International trade of cereals is forecast to drop to its lowest level since 2020, largely because China is expected to buy less grain from other countries.
A related FAO report highlighted the importance of international dialogue on food trade to protect global food security. It noted that taxes on imported agricultural goods have been cut by more than half since 2005, helping to keep trade flowing.