World food prices fell in July

World food prices fell in July

Despite the fall in food prices, risks still weigh on the food security of several countries.

World food prices fell sharply in July, driven down by the prices of cereals and vegetable oils, the Food and Agriculture Organization of the United Nations (FAO) announced on Friday.

Following an all-time high reached in March following the invasion of Ukraine, the FAO Food Price Index, which tracks changes in international prices of a basket of basic products, contracted by 8.6% over one month. This is a fourth consecutive decline.

The index, however, remains at high levels, standing at 140.9 points in July, with an increase of 13.1% over one year compared to June 2021, underlines the agency.

Máximo Torero Cullen, FAO Chief Economist, welcomes a welcome decline, especially from the point of view of access to food, recalling however that many risks weigh always on global food security, such as a recession or high fertilizer prices and their potential impact on production and farmers' livelihoods.

The FAO Vegetable Oil Price Index fell 19.2% in July to its lowest level in 10 months, driven by lower prices for all oils. blended oils and crude oil prices.

Abundant availability of palm oil in Indonesia and a good rapeseed harvest are pushing these prices down, coupled with sluggish import demand for imports. sunflower oil – of which Ukraine is a major producer – which is down sharply.

FAO Cereals Index drops by 11, 5%, with the largest decline being in world wheat prices, which fell no less than 14.5% in reaction to the agreement reached between Ukraine and Russia on the unblocking of the main ports of the Black Sea, underlines the organization.

The Razoni recently set sail with the first grain shipment from Ukraine on board since the Russian invasion .

Since the signing of this long-awaited agreement on July 22, a first ship, the freighter Razoni, set sail on Monday from Odessa after five months total port inactivity. Three new shipments of grain also left Ukraine on Friday, said Turkey, which oversees the implementation of these exports.

The FAO price index Sugar also fell 3.8% as lower ethanol prices led to higher-than-expected sugar production in Brazil in July. Favorable production prospects in India also contributed to the decline, offsetting concerns about European sugar beet yields.

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