April world food prices below last year’s

The Food and Agriculture Organisation (FAO) reported a 1,6% drop in its Food Price Index (FPI) in April, compared to March this year.

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he figure of 209,3 points was 3,5% lower than April 2013.

The FAO said the lower world food price were mostly due to a sharp drop in dairy prices, although sugar and vegetable oil were also lower. By contrast, cereals and meat prices increased slightly.

According to the monthly FAO report, the Cereal Price Index averaged 206,9 points in April 2014, up only 1 point (or 0,5%) from March, but still 24 points (or 10,3%) below its value in April 2013. The FAO said the monthly increase was less pronounced than those registered in February and March this year, as weather conditions improved in the US and tensions in Ukraine had little effect on the country’s pace of grain shipments. Rice prices tended to weaken in the various market segments, with the exception of aromatic rice varieties, where they remained stable.

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The Vegetable Oil Price Index averaged 199 points in April, down 6 points (or 2,8%) from March. The slide in the index was driven by palm oil, whose values dropped following reports of lower than anticipated import demand, most notably from the EU. Furthermore, Malaysia’s exports have been hit by the persistent strength of the country’s currency.

Soya bean oil prices, on the other hand, appreciated slightly as the market responded to the lingering tightness in global supplies.

The Dairy Price Index averaged 251,5 points in April, a sharp fall of 17 points, or 6,9%, compared to March. The market for all dairy products has been affected by reduced purchases by China and the Russian Federation. Additionally, an extended season in New Zealand and a good start to the dairy-year in the northern hemisphere have meant that supplies for export have increased.

Prices of all dairy commodities subsided, but particularly butter and milk powder.

The Meat Price Index averaged 185,8 points in April, 0,8 points (or 0,4%), above March. The marginal increase was a result of stronger prices for pork, in part due to concerns over the effect of porcine epidemic diarrhoea virus on export supplies in the US.

Although little changed, bovine meat prices were close to historic highs, due to dry weather conditions affecting production in Australia and the US. Prices of poultry and ovine meat were also stable.

The Sugar Price Index averaged 249,9 points in April, down 4,1 points (or 1,6%), from March. Prices declined amid reports of large sugar supplies in the main producing regions, including Thailand, India, and Australia. Generally dry weather in most producing countries, which should boost the sucrose level, also weighed on prices.