World Food Prices Reach New Peak since July 2011

The world food price barometer surged to a new peak reaching its highest level since July 2011. The Food and Agriculture Organization of the United Nations released its monthly report last week, which tracks changes in the international prices of a basket of food commodities. The FAO Food Price Index averaged 133.2 points in October, up 3% from September, rising for a third consecutive month. Cereal grain prices increased 3.2% from last month, and vegetable oil prices were up 9.6%, an all-time high. Meanwhile, dairy prices increased 2.6%, influenced by generally firmer global import demand.

Meat prices declined 0.7%, the third monthly decline, and sugar prices fell 1.8% in September, the first decline in six months. Despite an expected record world cereal production in 2021, global cereal inventories are seen heading for a contraction in 2021/22. The forecast for world cereal output in 2021 is now pegged at 2,793 million metric tons, down by 6.7 million tons since the previous report in October.

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