The global Food Price Index (FFPI) averaged 169.8 points in August 2019, down 1.1 percent (almost 2.0 points) from July but still 1.1 percent higher than in August 2018.
These figures were made public by the Food and Agricultural Organization (FAO) in Rome, Italy.
The decline in August marked the third consecutive monthly decrease in the FFPI, with the latest drop reflecting sharp falls in the prices of sugar and leading cereals, outweighing increases in all other sub-indices.
Cereal prices fall
The FAO figures reveal that Cereal Price Index averaged 157.6 points in August, down by as much as 6.4 percent (10.8 points) from July and 6.6 percent (11.1 points) from the corresponding month last year.
Just like in the month of July, the fall in the value of this sub-index in August reflects sharp declines in the prices of wheat and major coarse grains, particularly maize.
Wheat prices remained under downward pressure, hence, increased competition among the major exporters.
Maize values also turned sharply lower in August, primarily because of expectation of a much larger-than-earlier anticipated harvest in the United States, the world’s largest producer and exporter of maize.
Dairy prices up
Price quotations for cheese, Skim Milk Powder (SMP) and Whole Milk Powder (WMP) all rose, reflecting higher import demand for near-term deliveries, as market activities began normalizing with the end of the summer recess in the northern hemisphere.
But the price quotations for butter fell for the third consecutive month due to weaker demand, further accentuated by market optimism that Oceania’s export availabilities will rise in the new production season.
Sugar prices down
The latest month-on-month decline in international sugar prices largely comes on the back of a weakening Brazilian real, which tends to incentivize sugar exports.
Prospects of larger shipments by India and Mexico in 2019/20 further weighed on sugar price quotations.
Full Food Price Index: