11/6/21

International food commodities continued to show an upward trend for November.  The FAO’s Food Price Index averaged 134.4 points last month, a 1.2% increase from October and a 27.3% increase from November 2020.  It marks the fourth consecutive monthly rise, reaching heights not seen since June 2011.  Cereal and dairy prices led with the greatest increase while meat and oil prices were down.

Cereals averaged 141.5 points, 3.1% up from October and 23.2% above November 2020, largely due to high demand and low supply.  That marks the fifth straight month of increases and puts the category at its highest level since May 2011.  Despite tight supplies and wheat spillover, international barley prices rose in November.  Maize prices were up, due mostly to strong sales from Argentina, Brazil, and Ukraine.  Rice remained steady, controlled by progress among Asian harvests and scattered import demand.

Vegetable oils averaged 184.6 points last month, down just .2% from a record high October.  The decrease is due mainly to lower values for soy and rapeseed oils.  There was no change to palm oil prices.  Rising concerns over new Covid-19 cases created downward pressure on international palm oil, but effective support offset that pressure, keeping prices stable.  Soy and rapeseed were down slightly, due to demand rationing. 

Dairy averaged 125.5 points, a 3.4% month on month increase.  It was 19.1% above November 2020. International prices for butter and milk powder rose sharply for the third straight month caused by tight global export availability and depleted stocks. Those looking to secure spot supplies to offset tightening markets put further upward pressure on prices. Cheese rose slightly, due to increased demand and shipping delays.

Down .9% in November, meat averaged 109.8 points, marking the fourth consecutive month down.  It experienced a 17.6% year on year decrease. Poultry stayed stable with enough supply to meet demand, though problems of shipping container shortages and avian flu continue to plague the industry. Quotations for pork were down for the fifth straight month, due to reduced purchases from China, but chiefly within the European Union. Bovine meat prices stayed flat. Decreased quotations for Brazil’s meat were offset by higher Australian export values.  Ovine prices fell, due to higher exportable supplies from Australia.

Up almost 40% year on year, sugar averaged 120.7 points in November, up 1.4% from October.  The increase was due to higher ethanol prices and strong import demand brought on by lower freight costs.  Higher prices were limited by large shipments from India coupled with a positive outlook for the sugar exports from Thailand.

Come back here next month to find out how December fared as we look at the numbers that close out the year.  The next report from the FAO is released on January 6th. 

The original report can be found here: https://www.fao.org/worldfoodsituation/foodpricesindex/en/