A trade-weighted index that measures prices of five major food commodities on international markets – averaged 170.9 points in July 2019, slipping 1.1% below its level in June but up 2.3% from a year earlier. Global food commodity prices saw a slight decline in July, led by lower prices for some cereals, dairy, and sugar, more than offsetting firmer prices for meat and oils.
The cereal price index dropped by 2.7% from June but is 4.1% above its level in July last year. The overall decline was mainly driven by a slide in wheat and maize prices, reflecting, among others, ample export supplies. By contrast, the rice index marked its fifth successive month of stability amid generally quiet market activity.
The vegetable oil price index rose by 0.8% in July led by firmer soy and sunflower oil prices that balanced out a further drop in palm oil values. The decline of the latter was largely driven by a continued seasonal surge in crop production in Southeast Asia combined with sluggish global import demand. The meat price index posted a 0.6% increase from its slightly revised value for June, marking its sixth month-on-month price increase. Ovine and bovine meat prices rose further in July, boosted by robust import demand from Asia and weakening supplies from Oceania due to a seasonal decline. On the other hand, prices for pigmeat dropped slightly after four months of continued increases, reflecting larger export availabilities from Brazil and the United States. The dairy price index declined by 2.9% from June, representing the second consecutive monthly drop, led by a decline in butter quotations followed by cheese and whole milk powder. The sugar price index declined by 0.6% from June 2019, mainly driven by expectations of higher sugarcane yields in India, the world’s largest sugar producer. The decline in world prices was partially contained by a strengthening of the Brazilian Real against the US Dollar, a move that tends to restrain exports from Brazil, the world’s largest sugar exporter.