The latest FAO Food Price Index averaged 175.2 points in June, up 1.4% from May and 7.0% from a year earlier. The increase is mainly the result of higher wheat and meat prices.
The FAO index is a monthly trade-weighted index tracking international market prices of 5 major food commodity groups.
The FAO Cereal Price Index rose by 4.2% in the month, amid surging prices of high-protein wheat due to deteriorating crop conditions in the US. Maize prices, by contrast, declined amid record harvests in South America. FAO’s price indices for meat and dairy products also rose, while those for vegetable oils and sugar dropped.
Despite tightening supply conditions for high-protein wheat, global cereal supplies are likely to remain abundant in the coming year, according to FAO’s latest Cereal Supply and Demand Brief. FAO revised down its June forecast for global wheat output in 2017, while raising those of maize and rice. Global cereal production this year is likely to total 2,593 million tonnes, some 0.6% below that of 2016. World cereal stocks are expected to expand further to a new record high of around 704 million tonnes.