FAO: Food prices rose in July due to climate and geopolitical factors
Heat waves, energy prices, and geopolitical tensions drove up the Food and Agriculture Organization (FAO) Food Price Index in July, particularly affecting sugar, grain, and vegetable oil prices. The UN food agency report
Translated by Qiyas from كويت نيوز — Original source
Heat waves, energy prices, and geopolitical tensions drove up the Food and Agriculture Organization (FAO) Food Price Index in July, particularly affecting sugar, grain, and vegetable oil prices.
The UN food agency reported on Friday that the food price index rose by 0.6% month-on-month in July and by 1% year-on-year.
In July, this increase was linked to higher prices for sugar (+5.6%), grains (+3.4%), and vegetable oils (+2%).
The organization noted that these increases were partially offset by declines in meat and dairy product prices.
FAO stated that sugar prices surged last month due to “concerns” over the impact of heat waves and drought on European production, as well as the El Niño phenomenon on Asian production. Nevertheless, the index remains 8% lower than a year ago.
Climate change also affected grains, particularly wheat, whose prices rose significantly (by 5.8% in June and 9.9% year-on-year).
The organization also pointed out that wheat prices are influenced by “growing concerns about the continuation of export disruptions in the Black Sea.”
Corn production, whose price rose by 3.6%, was also affected by rising temperatures, even though it is already influenced by energy prices.
In contrast, rice prices remained generally stable.
The vegetable oil price index reached its highest level since June 2022. Strong demand from Indonesia’s diesel sector and rising crude oil prices supported palm oil prices. Soybean oil prices also rose, while sunflower seed and rapeseed oil prices declined, according to the organization.
Meanwhile, the meat price index fell by 2.8%, recording its first monthly decline this year. Poultry prices also dropped, mainly due to lower prices in Brazil amid abundant export supplies, as well as declines in pork and beef prices.
Only lamb prices rose in July, even reaching a new record high.
The dairy product price index recorded a slight decline (-0.7%) thanks to lower butter and milk powder prices, which offset higher cheese prices.
