ROME, ITALY — The benchmark for world food commodity prices declined marginally in August, as decreases in quotations for sugar, meat and cereals outweighed increases in those for vegetable oils and dairy products, the Food and Agriculture Organization of the United Nations (FAO) reported on Sept. 6. 

The FAO Food Price Index, which tracks monthly changes in the international prices of a set of globally-traded food commodities, averaged 120.7 points in August, down slightly from its revised July figure and 1.1% below its corresponding value in August 2023.

The FAO Cereal Price Index dropped by 0.5% from July, driven by lower global wheat export prices amid competitively priced Black Sea supplies and higher-than-expected production in Argentina and the United States. World maize prices rose slightly, reflecting the impact of heatwaves on yields in parts of Europe and North America, while the FAO All-Rice Price Index increased by 0.6%, as quotations for non-Indica varieties increased under the influence of seasonal tightness and currency appreciations of some exporting countries against the US dollar.

The FAO Vegetable Oil Price Index rose by 0.8% from July to reach a 20-month high, as increases in international palm oil prices more than offset declining quotations for soy, sunflower and rapeseed oils.

In a separate report released on Sept. 6, the FAO also trimmed its forecast for global cereal production in 2024, now pegging it at 2.851 billion tonnes, almost on par with that of 2023.

The new Cereal Supply and Demand Brief attributed its revisions to reduced harvest expectations for coarse grains, including maize, primarily due to hot and dry weather conditions in the European Union, Mexico and Ukraine. Meanwhile, the FAO has raised its forecast for global wheat output in 2024 as well as that for rice, which now is projected to reach an all-time high of 537 million tonnes.

World cereal total utilization in 2024-25 is forecast to rise to 2.852 billion tonnes, marking a 0.2% rise from 2023-24. Utilization of rice is predicted to reach a record high, driven by an expected accelerated growth in the food intake component.

World cereal stocks are forecast to expand by 1.2% at the end of the 2024-25 season, yielding a global cereal stocks-to-use ratio at 30.7%.

International trade in total cereals is now pegged at 485.6 million tonnes, representing a 3.3% decline from 2023-24, led mostly by lower traded volumes in coarse grains.