World meals costs surge for 3 consecutive months in Could

World meals costs surge for 3 consecutive months in Could

World meals costs rose for a 3rd consecutive month in Could, as larger cereals and dairy product costs outweighed decreases in sugar and vegetable oil costs, the Meals and Agricultural Organisation (FAO) mentioned on Friday.

The UFAO value index, which tracks adjustments within the worldwide costs of a set of worldwide traded meals commodities, averaged 120.4 factors in Could, up 0.9 p.c from its revised April degree.

The mixed common costs of cereal and dairy merchandise drove international meals costs by 122 factors within the interval underneath evaluation.

Cereal costs elevated probably the most to 119 factors in Could from 112 factors in April, indicating a 6.3 p.c rise on a month-on-month foundation. Nonetheless, it declined 8.2 p.c from its worth a yr in the past (129 factors).

In keeping with FAO, the sharp month-to-month rise in cereal costs was because of rising issues about unfavourable crop circumstances for the 2024 harvests, which affected crop yields in elements of Europe, Northern America and the Black Sea area.

Additionally, the worldwide company mentioned harm to the Black Sea delivery infrastructure exacerbated the upward strain on costs.

“Maize export costs additionally elevated in Could, reflecting manufacturing issues in each Argentina (because of crop harm from the unfold of Spiroplasma illness) and Brazil,” it mentioned.

Furthermore, spilling results from international wheat markets additionally affected maize costs, whereas the costs of barley and sorghum – two cereal merchandise, additionally rose within the interval underneath evaluation.

The dairy value index, one other key driver of Could international meals costs, plunged 1.8 p.c to 126 factors in Could from 124 factors recorded in April. It elevated 3.5 p.c above its worth within the corresponding interval of 2023.

“Worldwide value quotations for all of the dairy merchandise represented within the index rose in Could,” the FAO mentioned.
It famous that elevated demand from the retail and meals providers sector elevated dairy value quotations as milk manufacturing fell under historic ranges in Western Europe.

The FAO’s sugar value index declined 7.5 p.c to 117 factors in Could from 127 factors in April. This represents the third consecutive month-to-month decline, with the index down 25.5 p.c (40 factors) from its worth final yr and standing at its lowest degree since January 2023.

“The drop in worldwide sugar value quotations in Could was primarily pushed by the nice begin of the brand new harvest season in Brazil, which was bolstered by conducive climate circumstances contributing to an improved international provide outlook,” the report mentioned.

Moreover, bigger export alternatives from Brazil and decrease worldwide crude oil costs additional declined sugar costs.

The vegetable value index averaged 128 factors in Could, declining 2.4 p.c on a month-on-month foundation from 131 factors recorded in April. Nonetheless, it elevated 7.7 p.c above its worth a yr in the past.

This was largely pushed by decrease palm oil quotations, which offset soybean, rapeseed and sunflower oil costs within the worldwide market.

“Worldwide palm oil costs declined for the second consecutive month in Could, as outputs throughout main producing international locations in Southeast Asia seasonally elevated amid a protracted weak international import demand.”

In Could, the meat value index averaged 117 factors, declining marginally by 0.2 p.c on a month-on-month foundation, and 1.3 p.c from its worth in the identical month of 2023.

The FAO mentioned the worldwide costs of poultry and bovine meats fell, whereas these of pig and ovine elevated, noting that elevated export alternatives in Could amid decrease inner demand in some main producing international locations, led to a drop in poultry costs.

“Against this, the month-on-month enhance in world pig meat costs was underpinned by a requirement uplift and lingering provide tightness, primarily in Western Europe,” the FAO acknowledged.

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