May 24, 2021

FAO Food Price Index Highest Since 2014

FAO Food Price Index Highest Since 2014

The Food and Agriculture Organization (FAO) of the United Nations releases the FAO Food Price Index (FFPI) each month. The FFPI is calculated as the trade-weighted average of the prices of food commodities spanning the key agricultural markets for cereals, vegetable oils, sugar, meat, and dairy products. The FFPI for April 2021 is the highest the FFPI has been since 2014.

For April 2021, the FFPI averaged 120.9 points, 2 points higher than March 2021 and 28.4 points higher than April 2020. The increase marked the 11th consecutive monthly rise in the value of the FFPI. The April rise was led by strong increases in the prices of sugar, followed by oils, meat, dairy, and cereals.

The FAO Dairy Price Index averaged 118.9 points in April, up 1.4 points from March, rising for the 11th consecutive month and lifting the index 24.1% above its value a year ago. In April, butter quotations rose, supported by solid import demand from Asia, although weaker internal demand in Europe. Skim milk powder prices increased due to high import demand from East Asia, induced partly by concerns over potential shipping delays from Europe and Oceania. Cheese prices also increased due to high demand from Asia, and lower-than-expected production in Europe, and seasonally declining supplies from Oceania. By contrast, quotations for whole milk powder declined slightly, reflecting lower import demand for the available supplies following significantly high volumes traded recently.

The FAO Meat Price Index averaged 101.8 points in April, up 1.7 points from the slightly revised value for March, marking a 7th consecutive monthly increase and raising the index by 5.1% above the corresponding month last year. In April, bovine and ovine meat quotations rose, supported by solid demand from East Asia, amidst tight supplies from Oceania due to ongoing herd rebuilding and low inventories. Elevated internal sales in some producing regions also supported bovine and ovine meat prices. Pig meat quotations had continued high purchases by East Asia despite increased overall shipments from the European Union, while Germany continued with no access to the Chinese market over African swine fever concerns. Meanwhile, poultry meat prices remained steady, reflecting generally balanced global markets.