The FAO Food Price Index averaged 206.3 points in November 2013, almost unchanged from the revised value of 206.6 points in October, but 9.5 points (4.4 percent) below its November 2012 value. A sharp decline in sugar prices last month nearly offset the rise in oils. Cereals averaged slightly lower but meat and dairy values were stable.
The FAO Cereal Price Index averaged 194.2 points in November, down 2 points (1 percent) from October, and as much as 61 points (or 24 percent) below its November 2012 level. A record cereal crop this year has helped to improve the global supply situation, weighing on the international prices of all cereals, including wheat, maize and rice.
The FAO Vegetable Oil Price Index averaged 198.5 points in November, up 11 points (or 5.6 percent) from October. The rise in the index has been driven mainly by palm oil: the concurrence of strong global import demand, including for biodiesel production, and below-expectation output in Southeast Asia (following excessive rainfall) have pushed palm oil prices to a 13-month high. International prices for soy, sunflower and rapeseed oil also firmed on sustained demand, further contributing to the rise in the index.
The FAO Dairy Price Index averaged 251.4 points in November, practically the same as in October. Demand for milk powder, especially from China, remained strong and processors in the southern-hemisphere focused on this product rather than on butter and cheese. Southern-hemisphere milk production has passed its seasonal peak; however, supplies are adequate to meet current demand. Overall, the index stands 23 percent above its level in November 2012.
The FAO Meat Price Index averaged nearly 187.1 points in November, unchanged from October and similar to its level one year ago. Regarding the different categories of meat, prices for bovine and ovine meat increased further, while those for pig meat moved lower and poultry was stable. In the case of bovine and ovine meat, limited export supplies lent support to prices, while pig meat and poultry benefited from the reduced cost of feed.
The FAO Sugar Price Index averaged 250.6 points in November, down 14.2 points (5.3 percent) from October. The decline was mainly attributable to improved harvesting operations in Brazil, the world’s largest sugar producer and exporter. Speculations of a possible surge of exports from Brazil and India, owing to the weakening of currencies against the US dollar in November exacerbated the price slide. Overall, sugar prices were particularly volatile amid continued uncertainties on the extent of the anticipated production surplus for the new 2013/14 season.