The Food and Agriculture Organization's (FAO) food price index fell in August to a new two-year low, reversing a rebound seen the previous month, the agency said on its Friday press release.
The FAO food price index, which tracks the most globally traded food commodities, averaged 121.4 points in August against 124 for the previous month. This figure marks the lowest level since March 2021 and is 24% lower than the all-time high recorded in March 2022.
The overall decrease in the index was driven by declines in dairy products, vegetable oils, meat, and cereals. However, there was a notable increase in FAO's rice benchmark, which reached a 15-year high due to Indian export restrictions.
The FAO reported that its cereal index decreased by 0.7% compared to July. In contrast, the rice index surged by almost 10% as a result of India's decision to ban certain rice exports in July, disrupting trade during a period of limited supplies before new-crop harvests.
The FAO also noted that the sugar index rose by 1.3% in August, marking a 34% increase compared to the same period last year. Vegetable oil prices experienced a decline of 3.1% in August, while dairy prices continued their downward trend with a 4% drop, marking the eighth consecutive monthly decline.
In a separate report on cereal supply and demand, the FAO projected global cereal production for this year to be approximately 2.815 billion tons, slightly lower than the previous estimate of 2.819 billion tons.