Although prices are down globally, they are still very high and continue to rise in domestic markets, posing new challenges for food security.”
Máximo Toreo, Chief Economist of the FAO.
World food prices registered a 20.5% annual drop in March, however they are still “very high”, reported the Food and Agriculture Organization of the United Nations (FAO, for its acronym in English).
In relation to February, the FAO Food Price Index (which measures a basket of basic products) fell 2.1 percent.
“Abundant supply, weak import demand and the extension of the Black Sea Grain Initiative (the maritime corridor that allows exports from Ukraine) contributed to this decline,” the organization explained.
“Despite the fact that prices fell worldwide, they remain very high and continue to rise in domestic markets, which poses additional problems in terms of food security,” said Máximo Torero, FAO chief economist.
The fall in the prices of grains (5.6% compared to the previous month) and vegetable oils (-3%) offset the rise in sugar (1.5%), which is at its highest level since October 2016 , due to fears linked to a drop in production projections in India, Thailand and China.
Meat prices increased 0.5%, as international prices for bovine meat rose under the influence of higher domestic prices in the United States given expectations of a decrease in supply in the future.
The price of wheat fell 7%, driven by strong production in Australia, improving crop conditions in the European Union, supplies from Russia and continued exports from Ukraine.
For their part, world corn prices fell 4.6%, partly due to expectations of a record harvest in Brazil, and rice prices fell 3.2% due to harvests underway or imminent in major exporters such as India, Vietnam and Thailand.
Increased wheat production
The FAO also raised its forecast for world wheat production for this year to 786 million tonnes, or 1.3% below the 2022 level and would be the second largest production on record.
“In Asia, a virtually unprecedented planted area is expected, while dry conditions would affect North Africa and southern Europe,” the FAO said, also raising its forecast for world cereal production to 2.777 million tons.
World rice production in 2022/23 stands at 516 million tons, 1.6% below the record 2021/22 crop.
