Monday, 07 March 2022 12:55

FAO Food Price Index rises to record high in February

Written by  Staff Reporters
Increases in the FAO Food Price Index were lead by rises in vegetable oil and dairy prices. Increases in the FAO Food Price Index were lead by rises in vegetable oil and dairy prices.

The benchmark gauge for world food prices went up in February, reaching an all-time high, says the Food and Agriculture Organization of the United Nations (FAO).

The rise was led by vegetable oils and dairy products.

The FAO Vegetable Oils Price Index led the increase, rising 8.5% from January to reach a new record high, mostly driven by increased quotations for palm, soy and sunflower oils.

The sharp increase was primarily driven by sustained global import demand, which coincided with reduced export availabilities of palm oil from Indonesia, lower soybean production prospects in South America, and concerns about lower sunflower oil exports due to disruptions in the Black Sea region.

The FAO Dairy Price Index averaged 6.4% higher in February than in January. This was underpinned by lower-than-expected milk supplies in Western Europe and Oceania, as well as persistent import demand, especially from North Asia and the Middle East.

The FAO Meat price index rose 1.1% from January, with beef quotations reaching a new record high amid strong global import demand and tight supplies of slaughter-ready cattle in Brazil as well as high demand for herd rebuilding in Australia.

While pig meat prices edged up, those of lamb and poultry meat declined, in part due to high exportable supplies in Oceania and reduced imports by China following the end of the Spring Festival.

“Concerns over crop conditions and adequate export availabilities explain only a part of the current global food price increases. A much bigger push for food price inflation comes from outside food production, particularly the energy, fertilizer and feed sectors,” says FAO economist Upali Galketi Aratchilage.

“All these factors tend to squeeze profit margins of food producers, discouraging them from investing and expanding production.”

The FAO Food Price Index measures average prices over the month, so the February reading only partly incorporates market effects stemming from the conflict in Ukraine.

More like this

War in Ukraine causes grain price hikes

As war in Ukraine rages on, world food commodity prices have made a significant leap in March to reach their highest levels ever, the Food and Agriculture Organization of the United Nations (FAO) has reported.


Controversial changes for pigs

A controversial new welfare draft code is triggering vigorous debate between pig farmers and animal welfare advocated as to what…

MPI to monitor winter grazing

As Otago and Southland enters the winter grazing season, MPI says it will have inspectors on the ground ensuring things…

Machinery & Products

Making life easier

Many temporary sheep fencing systems can be troublesome, with reels jamming or breaking and the bugbear of silly hooks on…

Valtra's following grows

With the release of its N5 and T5 series of tractors, Valtra continues to expand its presence in the Australia-New…

» The RNG Weather Report

» Latest Print Issues Online

The Hound

No free ride!

OPINION: This old mutt is getting somewhat tired of multi-national, tax-dodging, fund-raising group Greenpeace always given front and centre mainstream…

How come?

OPINION: A mate of yours truly is questioning exactly why the Māori ag sector have been given special budget funding by…

» Connect with Rural News

» eNewsletter

Subscribe to our weekly newsletter