Global food commodity prices fell in July for a second consecutive month.
The UN Food and Agriculture Organization (FAO) Food Price Index tracks changes in the international prices of the most globally-traded food commodities.
The July drop reflected declines in the quotations for most cereals and vegetable oils, as well as dairy products.
Dairy and meat indices
The FAO Dairy Price Index declined 2.8% from June, impacted by slower market activity in the Northern Hemisphere due to ongoing summer holidays, with skim milk powder registering the largest drop, followed by butter, whole milk powder and cheese.
The FAO Meat Price Index rose marginally from June, with quotations for poultry meat rising the most due to increased imports by east Asia and limited production expansions in some regions.
Bovine meat prices also strengthened, buoyed by high imports from China and lower supplies from major producing regions. Meanwhile, pigmeat prices fell, following a decline in imports by China.
Cereal, grains and veg oil
The FAO Cereal Price Index was 3% lower in July than in June, pushed down by a 6% month-on-month drop in international maize prices associated with better than earlier projected yields in Argentina and improved production prospects in the US.
Prices of other coarse grains such as barley and sorghum also dropped significantly, reflecting weaker import demand.
However, wheat quotations edged 1.8% higher in July – reaching their highest level since mid-2014 – in part due to concerns over dry weather and crop conditions in North America.
The FAO Vegetable Oil Price Index reached a five-month low, declining 1.4% from June, as lower prices for soy, rape and sunflower seed oils more than offset rising palm oil values.
Acute food insecurity reaches new highs
Efforts to fight a global surge in acute food insecurity are being stymied in several countries “by fighting and blockades that cut off life-saving aid to families on the brink of famine”.
The FAO and World Food Programme (WFP), in a new report, warned that “bureaucratic obstacles” along with “a lack of funding” also hamper the two agencies’ efforts to “provide emergency food assistance and enable farmers to plant at scale and at the right time”.
“This is of grave concern as conflict, the economic repercussions of Covid-19 and the climate crisis are expected to drive higher levels of acute food insecurity in 23 hunger hotspots over the next four months as acute food insecurity continues to increase in scale and severity,” the FAO said.
The agencies warn that 41 million people are at risk of falling into famine unless they receive immediate food and livelihood assistance.
A trend expected to worsen
2020 saw 155 million people facing acute food security at crisis or worse levels in 55 countries, an increase of more than 20 million from 2019 – a trend expected to worsen this year.
“The vast majority of those on the verge are farmers. Alongside food assistance, we must do all we can to help them resume food production themselves, so that families and communities can move back towards self-sufficiency and not just depend on aid to survive,” FAO director-general QU Dongyu said.
“That’s difficult without access, and without adequate funding – and so far, support to agriculture as key means of preventing widespread famine remains largely overlooked by donors, unfortunately.
“Without such support to agriculture, humanitarian needs will keep skyrocketing, that’s inevitable,” he added.