In January, world food prices reached their highest level since 2011
The average value of the FAO Food Price Index, which monitors monthly fluctuations in world food prices, increased by 1.1% in January compared to December and reached a maximum since April 2011 - 135.7 points. The main reason for the growth of the index was the rise in price of vegetable oil and dairy products.
Most of all - by 4.2% to 185.9 points - in January, the value of the vegetable oil price index increased, it reached the highest level for the entire period of observation, FAO notes. Such dynamics was due to the growth of palm oil quotations due to low production volumes in key producing countries and a possible reduction in export supply in Indonesia.
In addition, prices for soybean oil began to recover. The reason was active import purchases, in particular from India. The cost of rapeseed and sunflower oils is also rising as a result of reduced supply and higher global import demand. The increase in world quotations of vegetable oils was also facilitated by the rise in prices for crude oil, the FAO said in a statement.
The average grain price index rose by 0.1% in January, while it is now 15.6% higher than in January 2021. Including a 3.8% increase in corn prices due to the ongoing drought in the Southern Hemisphere. Meat in January 2022 almost did not increase in price, but over the year the index rose by 17.3%. At the same time, beef prices reached another record due to the fact that demand exceeded supply. The cost of pork has not changed, while lamb and poultry, on the contrary, has decreased.
The sugar price index was the only indicator that fell in January. Compared to December, it decreased by 3.1% on the back of favorable production forecasts in key exporting countries - India and Thailand - as well as increased rainfall and lower ethanol prices in Brazil.
The value of the price index for dairy products increased by 2.4% in monthly terms and by 18.7% in annual terms. This indicator has been increasing for the fifth month in a row, with skimmed milk powder and butter prices increasing the most. Among the reasons, FAO experts named a reduction in export offers from Western Europe, low milk production in Oceania, as well as a labor shortage amid the pandemic.