World food prices drop in May for second consecutive month
05 June 2014, 15:26
Rome - Global food prices fell in May for the second consecutive month as lower dairy, cereal and vegetable oil prices counteracted rising sugar and firm meat prices, the United Nations Food Agency said on Thursday.
The Food and Agriculture Organisation's (FAO) price index, which measures monthly price changes for a basket of cereals, oilseeds, dairy, meat and sugar, averaged 207.9 points in May.
This was a fall of 2.5 points or 1.2 percent from April, when food prices fell led by a sharp drop in dairy prices due to reduced buying in China and Russia and an extended season in New Zealand that boosted stocks. Dairy prices continued to fall in May, by 12 points from the previous month.
FAO's cereal price index was lower at 204.4 points, a 2.4 point decrease from the previous month. The agency raised its world cereal production forecast for nearly 2.48 billion tonnes, almost 1 percent higher than it reported the month before.
This would be 1.4 percent lower than 2013's record world output but would still be the second largest production ever.
FAO forecast world cereals stocks at the end of crop seasons in 2015 to be 576 million tonnes, an increase of almost 10 million tonnes from last month's forecast.
World wheat production was forecast at nearly 703 million tonnes in 2014, 12.6 million tonnes below 2013's record harvest.
Wheat prices, which had contributed to price rises in recent months partly due to fears of disrupted trade flows from Ukraine, fell as shipping patterns from the country remained regular and weather conditions improved, FAO said.