The Food and Agriculture Organization's food price index (FAO) of the United Nations came in at 159,3 points in March. That is a huge jump, of 17,9 points, compared to the February index. The food price index is now at its highest level since its inception in 1990. The price increases in vegetable oils, grains and meat play the biggest role in the big step up.
The price index for grains was 170,1 points last month. That is a plus of 24,9 points compared to February and the highest level ever. The rise in the grain index is not surprising. "It is a reflection of the rise in world market prices following the war between Ukraine and Russia. The expected loss of exports from the Black Sea region exacerbates the already existing tight global availability of wheat," the report by the Food and Agriculture Organization said. Agricultural organization. The (dry) crop conditions in the United States also pushed up prices last month.
The FAO vegetable oil price index also played a major role in March, with a value of 248,6 points. That is 46,9 points higher than in February and also a new record. Higher prices for sunflower oil, soybean oil, palm oil and rapeseed oil are the reason for this. The price increase of sunflower oil is also related to the war in Ukraine and the concerns about availability that this entails. "The other three vegetable oils are increasing in price as they are already seen as suitable replacements," according to the Food and Agriculture Organization of the United Nations.
Dairy and meat also more expensive
Dairy products and meat also became more expensive last month, albeit to a lesser extent than the above product categories. The dairy price index rose by 3,7 points to 145,2 points. This is the seventh month that this FAO price index has risen. "Lower milk production in western Europe is causing a tightening of the dairy market and that keeps prices at a high level," the organization outlines on its own website. Butter and milk powders in particular have risen in price last month due to strong demand from Asian markets and solid demand in Western Europe.
The FAO Meat Price Index came in at 120 points in March, an increase of 5,5 points compared to a month earlier. This is also a record level. In fact, last month pork prices showed the strongest increase since 1995, supported by shortages in the supply of pigs for slaughter in Western Europe and a strong increase in internal demand. "The latter has everything to do with the approach of Easter," says the Food and Agriculture Organization. International poultry meat prices have also risen, partly due to reduced supplies due to bird flu.
Sugar market is relatively calm
In light of the above, the sugar market can be described as relatively calm, while a price increase is also visible there. In March, the Food and Agriculture Organization's sugar price index came in at 117,9 points, an increase of 7,4 points compared to February. "This immediately reverses most of the decline of the past three months. This level is also 20% higher than in the same month last year," the organization reports in an update. The high prices for Brent crude oil are the reason for the rise in the sugar price index.
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