Sharpest falls in global food prices since 2008
The latest food price index from the UN Food & Agriculture Organisation (FAO), covering August, fell 5.2% from July, the largest month on month fall since December 2008 and was down 21% from a year earlier.
Meat though was the one commodity that did not decline compared with July this year whereas all the others did with vegetable oils and dairy showing particularly sharp reductions. In fact the meat index was at its highest level since February in contrast to sharp reductions for all other commodities over the same period.
High stock levels of cereals, oil seeds and dairy products are responsible for much of the fall. However, a number of other factors have also influenced this decline. These include low energy prices and concerns about China’s economic slowdown and its negative consequences on the global economy and financial markets.
The FAO Meat Price Index averaged 173 points in August and follows an increase in the price of ovine meat, while other meats were stable compared with July. This left the measure 39 points (18%) below its historic peak in August 2014, driven mainly by falls in pig and ovine meat prices. However falls were seen over this period for all four major meats.