The United Nations‘ Food and Agriculture Organization (FAO) reported on Friday that global prices for essential food items have reached their lowest point in two years.
The FAO’s Food Price Index, which measures the cost of key food commodities, has not been at this level since March 2021.
It has seen a significant decline, dropping by as much as 24% compared to its all-time high in March 2022, which followed Russia’s full-scale invasion of Ukraine.
In an official statement, the FAO attributed this decline to reductions in the price indices for dairy products, vegetable oils, meat, and cereals.
According to the FAO, the abundant supply of these food products has played a pivotal role in driving down prices.
Furthermore, certain commodities, such as sunflower oil and sheep meat, have experienced decreased demand, contributing to the overall price drop.
However, not all staples have followed this trend. Sugar and rice prices have been on the rise, with rice reaching a 15-year high.
This upward trajectory can be primarily attributed to export restrictions imposed by India, the world’s largest rice producer.
Additionally, extreme weather conditions, notably the return of the El Niño oceanic phenomenon, have raised concerns about global crop yields.
The potential impact of El Niño on sugarcane crops has also led to increased sugar prices, compounded by dry weather conditions in Thailand, a leading sugar-producing nation.
The FAO reported that cereal prices have decreased since the previous month, despite the ongoing suspension of a grain trade agreement between Russia and Ukraine.
This drop can be attributed to the temporary increase in availability during the harvesting season in the northern hemisphere.
The withdrawal of Russia from the grain deal in July had raised concerns about a deepening global food crisis.
Negotiations to revive the agreement are currently underway, offering a glimmer of hope for stability in the international food market.
