The Food and Agriculture Organization of the United Nations (FAO) has stated in its August report that, global food commodity prices surged in August.
The latest rise in prices comes on the back of two consecutive months of decline in world commodities price index. The month of June and July saw commodity prices rebound in the international market as price quotations for sugar, wheat and vegetable oils declined.
The FAO food price index, which keeps track of monthly changes in the global prices of commonly traded food commodities, averaged 127.4 points in August. This represents a 3.1 per cent increase from that which was recorded in July. In addition, the month of August also recorded a 32.9 percent gain on year-on-year basis.
The report further disclosed that August sugar price index was 9.6 percent higher compared to July, as concerns over frost damage to crops in Brazil, the world’s largest sugar exporter persisted. It, however, noted that production concerns were cushioned by expectations of good production in India and the European Union.
Moreover, international vegetable oil prices also rise by 6.7 percent in August, while international palm oil prices also soared to historic highs due to protracted concerns over below-potential production and its resulting inventory reduction in Malaysia.
Additionally, the international food agency further disclosed that the cereal price index which averaged 3.4 percent, is higher in August compared to July. Furthermore, world wheat prices also climbed by 8.8 percent as reduced harvest expectations in several major exporting countries weighed on supply.
On the other hand, maize prices remained on a downward trajectory, losing 0.9 percent as improved production prospects in Argentina, the European Union and Ukraine moderated the lowered production forecasts in Brazil and the U.S.
However, the FAO meat price index was slightly higher. The rise can be attributed to China’s strong demand for ovine and bovine meat. Meanwhile, rising import demand from East Asia and the Middle East buoyed poultry prices. Pig meat prices, however, recorded a decline due to China’s recent reduction in purchases and weak internal demand in Europe.
For the dairy index, the commodity price was down marginally in the month of August. This is as a result of international quotations for milk powders declining amid a weak global import demand. Also,FAO noted that seasonally rising export availability in Oceania, more than offset rising butter and cheese prices.
However, many analysts predict the global commodity prices to decline in the month of September as the production season in major countries draw closer.
Meanwhile, in Ghana, it can be recalled that Esoko Ghana, a tech based mobile data collection institution also predicted that food prices on the Ghanaian markets are likely to drop by end of August this year, 2021.
“As we approach the end of this month August and early September, food prices will begin to come down because food production cycle in the southern part of the country would have been complete. So, the produce will start hitting the markets in the capital city which will bring food prices low”.Esoko Ghana