World food prices rise for first time in seven months
PARIS: Global food prices rose in March, the first increase since July, pulled higher by cooking oil prices despite the cost of grains continuing to ease, the UN’s Food and Agricultural Organization said Friday. The FAO’s overall Food Price Index climbed 1.1 percent over the month to stand at 118.3 points in March 2024. On an annual comparison it was 7.7 percent lower. The sub-index for vegetable oils jumped by 8.0 percent over the month to reach a one-year high. The FAO said prices for palm, soy, sunflower and rapeseed oils all climbed higher.
Rising palm oil prices were driven by seasonal drops in output in leading producing nations that coincided with strong demand in Southeast Asia, while demand from the biofuel sector pulled up soy oil prices. Dairy prices rose by 2.9 percent in March on a monthly basis, while meat prices climbed 1.7 percent.
Meanwhile, cereals prices slid 2.6 percent on a monthly basis, while sugar prices fell 5.4 percent. Food prices reached a record high after Russia invaded agricultural power Ukraine in February 2022 but have dropped since then. Last month’s uptick comes as inflation has slowed dramatically in many countries but a recent rebound in global oil prices has sparked concern it may persist at a level that could discourage central banks from cutting interest rates.
Agri-food trade surplus
In another development, the EU racked up a record agri-food trade surplus in 2023 - exporting far more farm goods than it imported - even as farmers feeling the squeeze on their livelihoods prepared to launch protests across the bloc. Agri-food exports from the bloc reached 228.6 billion euros last year, as imports fell to 158.6 billion - creating a record surplus of 70.1 billion euros, up 22 percent on the previous year, European Commission data showed.
The data further cements the EU’s status as the world’s leading agricultural power - though it may not feel that way to farmers complaining they cannot live on the prices paid for their produce by big industrial buyers, the main beneficiaries of the booming surplus. “This positive balance is mainly due to sustained high prices for EU export products paired with declining world prices for imported products,” particularly for cereals, the commission said in an annual report. Imports from Ukraine - another source of anger for farmers who see them as unfair competition - were down 10 percent since 2022, but still 71 percent higher than 2021 levels, before the bloc lifted trade restrictions in response to Russia’s invasion.
Key drivers of EU exports included cereal preparations, dairy products, and wine - together accounting for around one third of the total. The United Kingdom was the top destination for EU agri-food exports, accounting for 22 percent in value, followed by the United States at 12 percent and China at six percent. Ukraine currently stands as the bloc’s third source of agri-food imports, accounting for seven percent of the total, after Brazil and the United Kingdom. — Agencies