The Global Food Price Index Recorded Slightly Lower for August’24

The U.N. Food and Agriculture Organization reported a slight decrease in its global food price index in August. The decrease was influenced by lower prices for sugar, meat, and cereals, despite increases in dairy and vegetable oil prices. This index measures the price movements of the most globally traded food commodities. The price index in August were recorded at 120, while it was 120 in July, 2024.

Notably, the index reached a three-year low in February, following a significant decline from the record high in March 2022 triggered by geopolitical tensions arising from Russia's invasion of Ukraine. The current index level represents a 1.1% decrease from the same time last year and a 24.7% reduction from the March 2022 peak.

Additionally, the FAO has revised its 2024 global cereal production forecast downward by 2.8 million metric tons to 2.851 billion tons, attributing the cut to lower yield expectations for coarse grains in the European Union, Mexico, and Ukraine due to unfavorable weather conditions. This adjustment brings the forecast close to last year's production levels.

For the 2024/25 season, the world cereal utilization forecast was also reduced by 4.7 million tons from the previous estimate, now expected to be 2.852 billion tons, marking a modest 0.2% increase over the 2023/24 season.

Moreover, the FAO anticipates a reduction in global cereal stocks by the end of the 2025 season, projecting a decrease of 4.5 million tons to 890 million tons.