F.A.O. Food Price Index falls again
July 5, 2012
ROME — The Food and Agriculture Organization Food Price Index fell for the third consecutive month in June, dropping 4 points, or 1.8%, from May to its lowest level since September 2010. The index, at 201, was down from 205 in May and off from 233 in June 2011. The average prices of all commodity groups in the index were below May levels, with the largest drop registered for oils and fats.
“Continued economic uncertainties and generally adequate food supply prospects kept international prices of most commodities under downward pressure, although growing concerns over adverse weather sustained prices of some crops toward the end of the month,” the F.A.O. said.
The F.A.O. index for cereals totaled 221 in June, unchanged from May but down 38 points, or 15%, from 259 points in June 2011.
“Grain prices were very volatile in June, with weather as the main driver,” the F.A.O. said. “After a generally subdued situation during the first half of the month, markets moved up in the second half amid deteriorating crop prospects, most notably for maize in the United States.”
The F.A.O. lowered its forecast for 2012 world cereal production by more than 23 million tonnes from May, which is likely to result in a smaller build-up of global stocks by the end of seasons in 2013. The new forecast for world cereal production in 2012 stands at 2,396 million tonnes, still a record level and 2% higher than the previous high registered last year.