The Food and Agriculture Organization of the United Nations (FAO) announced this Friday that the prices of cereals and vegetable oils in world markets fell in July for the fifth consecutive month, causing a drop in the food cost index .
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Compared to last June, the indicator showed a decrease of 8.6 percent, although the FAO reports that the decline in the basket of basic food products is still 13.1 percent above that registered in July 2021.
The entity notified the decrease in the prices of all types of oil in the world market, in which that of vegetable origin decreased by 19.2 percent from June to July of this year, reaching its minimum mark in ten months.
the @FAO Food Price Index averaged 140.9 points in July, ��8.6% from June, marking the 4th consecutive monthly decline.
Major cereal & vegetable oil prices recorded double-digit percentage decline.
The Index remained 13.1% higher than in July 2021.
— FAO Newsroom (@FAOnews)
August 5, 2022
The FAO reports that this happened due to the expectation created by the large production of palm oil for export purposes from Indonesia, the low international demand for sunflower oil exports and the decline in crude oil prices.
On the other hand, cereal prices experienced a decline of 11.5 percent last July, although compared to the same period in 2021, they remain 16.6 percent higher.
In addition, the FAO stressed that the price of wheat fell by 14.5 percent, after the agreement between Russia and Ukraine to guarantee exports stranded in Black Sea ports, as well as the increase in the availability of cereals in Argentina and Brazil.
Likewise, the agency reflected that rice prices also fell for the first time in 2022.
Food derived from milk became cheaper by 2.5 percent in July, although it remains 25.4 percent above its cost in July 2021. Although the prices of milk, cheese and butter fell, those of cheese have stabilized, due to the supply of European tourism.
Food prices dropped again in July led by price drops in veg oils & cereal (partly in reaction to deal resuming Ukrainian grain exports). Still, it was 13% higher than in July 2021. High fertilizer prices & bleak economic outlook strain food security.
– Maximo Torero (@MaximoTorero)
August 5, 2022
The FAO also specified that due to the weak demand for imports of beef, sheep, pork and their derivatives, their prices fell 0.5 percent compared to July.
However, the cost of poultry reached an all-time high, as a result of high import demand and product shortages due to successive outbreaks of avian flu in exporting countries in the northern hemisphere.
For the chief economist of the FAO, Máximo Torero, the decrease in food prices is good news, particularly after the increase in prices in recent months affected low-income families.
But he warned that many uncertainties remain, including high fertilizer prices, which may affect future production prospects and farmers’ livelihoods.”
Disclaimer: Via Telesur – Translated by RJ983
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