Victor Uzoho
A report by the United Nations’ Food and Agriculture Organisation (FAO), has revealed that global food prices fell slightly in December, as international prices for vegetable oils and sugar fell significantly from lofty levels.
The Food Price Index, which tracks monthly changes in the international prices of commonly-traded food commodities, averaged 133.7 points in December, a 0.9% decline from November but still up 23.1% from December 2020.
Commenting on the obtained by Sustainable Economy, FAO’s Senior Economist, Abdolreza Abbassian, said while high prices are expected to give way to increased production, the high cost of inputs, ongoing global pandemic and uncertain climatic conditions are leaving little room for optimism about a return to more stable market conditions in 2022.
Reviewing the entire year 2021, the Food Price Index averaged 125.7 points, a 28.1% increase above 2020.
Also, the Cereal Price Index decreased 0.6% from November, as wheat export quotations fell amid improved supplies following southern hemisphere harvests, offsetting firmer maize prices underpinned by strong demand and concerns over persistent dryness in Brazil.
For the full year, Cereal Price Index reached its highest annual level since 2012 and averaged 27.2% higher than in 2020, with maize up 44.1%, wheat up 31.3%, but rice down by 4.0%.
However, the Vegetable Oil Price Index fell 3.3% in December, with weaker quotations for palm oil and sunflower oil reflecting subdued global import demand that may be linked to concerns over the impact of rising COVID-19 cases.
For 2021, the Vegetable Oil Price Index reached an all-time high, increasing 65.8% from 2020.
Similarly, the Sugar Price Index slipped 3.1% from November, reaching a five-month low, reflecting concerns over the possible impact of the Omicron COVID-19 variant on global demand as well as a weaker Brazilian Real and lower ethanol prices.
For year in review, the Sugar Price Index rose 29.8% from the previous year to its highest level since 2016.
The Meat Price Index was broadly stable in December but over 2021 it was 12.7% higher than in 2020.
The Dairy Price Index was the only sub-index to increase in December, rising 1.8% from the previous month, as international quotations for butter and milk powders increased amid lower milk production in Western Europe and Oceania.
Cheese prices declined marginally, reflecting a preference for Western European dairy products. In 2021, the Dairy Price Index averaged 16.9% higher than in 2020.
