World prices of food commodities registered slight decreases in November and thus reached the eighth consecutive month of declineafter the strong impact caused by the war between Russia and Ukraine last March, according to the indicator of the Food and Agriculture Organization of the United Nations (FAO) on Friday.
The index, which tracks monthly changes in the world’s most traded food commodities, remained stable and averaged 135.7 points in October, 6 tenths less than in September, registering falls in the international values of cereals, meat and dairy products that offset increases in vegetable oils and sugar.
Food, along with energy, They represented one of the great engines of the global inflationary shock this year.
After the increases at the start of the war between Russia and Ukraine last March, the indicator began a downward trend in the last eight months, and it is already only 0.3% above the levels of November 2021.
In the case of cereals, prices fell 1.3% per month, although they are still 6.3% more expensive than a year ago.
After the uncertainty regarding the continuity of the agreement between Russia and Ukraine for the transport of grain in the Black Sea that produced a rise in their values in October, wheat and corn –in view of the renewal of the understanding- fell 2.8% and 1.7% respectively.
To this reason is added, in the case of wheat, lower import demand from the United States and greater supply from Russia.
The corn
Meanwhile, as far as corn is concerned, the improvement in transportation on the Mississippi River in the United States is added, after complications from his downspout.
Among the other grains, sorghum fell 1.2% while barley increased 2.5%; and rice, meanwhile, increased 2.3% due to its good demand and the depreciation of the dollar.
Regarding the outlook for the coming months, The FAO again lowered its forecast for world cereal production in 2022 by 7.2 million tons to 2,756 million, 2% less than the previous year.
The reduction in the projection is due -says the FAO- to the lower prospects for maize production in Ukraine.
In the case of wheat, despite reducing its projection by 2.7 tons due to the dry conditions in Argentina, a historical record would be registered when forecasting 781.2 million tons.
As for vegetable oils, these increased 2.3% after seven months of lossesdriven by soybean and palm, and despite the falls in rapeseed and sunflower.
dairy and soy
Soybean prices increased due to increased import demand as it has a more competitive price than other edible oils, and by the concern in the production due to excessive rains in Southeast Asia; while soybean registered persistent demand from the US biodiesel sector in November.
Among the other commodities, sugar rose 5.2%, with strong demand facing restricted supply due to harvest delays in key producing countries and the announcement of a lower export quota by India.
To this is added the high prices of ethanol in Brazil, that motivate the use of cane to produce this component.
Dairy products registered a drop of 1.2% due to the lower demand for powdered milk due to the stocking of importers and the lower interest in China.
Butter also fell due to the uncertainty of its demand in the coming months and its high price on shelves, while cheese rose due to its solid import demand.
Finally, meat decreased 1.1%, a decrease driven by bovine meat compared to the high availabilities of Australia and Brazil.
The other meats, in contrast, rose, especially sheep due to strong demand, and, in the case of poultry, due to outbreaks of bird flu that impacted production.
