Global food prices fall in October

Global food prices dipped in October, led lower by dairy products, which averaged 27 per cent below its all-time high reached in early 2011. The Food and Agriculture Organisation (FAO) Food Price Index averaged 176.4 points for the month of October 2017, down 1.3 per cent from September, but up 2.5 per cent from a year earlier. It is a measure of the monthly change in international prices of a basket of food commodities. The FAO Dairy Price Index declined 4.2 per cent during the month, marking its first drop since May 2017. International quotations for butter and whole milk powder eased in October, as importers held back on purchases, awaiting new supplies from Oceania, while the low demand and ample intervention stocks in the European Union (EU) pushed skim milk powder prices down. The FAO Vegetable Oil Price Index also declined, by 1.1 per cent from its September value, as key palm and soy oil prices eased in light of positive production prospects. The FAO Sugar Price Index declined 0.7 per cent, influenced by weakening in the currency of Brazil, the largest exporter, and on the back of prospects for larger beet crops in the EU and a bigger output in Russia. The FAO Meat Price Index declined 0.9 per cent, as intensifying competition among pigmeat exporters, combined with sluggish import demand, drove international quotations lower. The FAO Cereal Price Index edged up a notch, 0.4 per cent led by higher rice prices, even as wheat quotations were generally lower. The worldwide production of coarse grains is set to reach a new record, thanks to expansion in South America and southern Africa. While wheat production is forecast to decline slightly, due mostly to lower harvest volumes foreseen in the US, the global rice output is expected to remain broadly stable.