FAO food price index falls to lowest in six years

The Food and Agriculture Organization of the United Nations released the Food Price Index on the 6th, saying that the index averaged 164.6 points in July, the lowest level in six years.

According to the FAO website, the food price index fell 1.0 per cent in July from June and 19.4 per cent from the same period last year, falling to its lowest monthly average since September 2009.

FAO said the decline was mainly due to a sharp drop in the prices of dairy and vegetable oils, which offset a small increase in the prices of sugar and cereals.

Specifically, the dairy product price index fell 7.2 month-on-month in July. The reason for the decline was that the import demand in China, the Middle East and North Africa was reduced, while the EU's milk production was large, resulting in an abundant supply of dairy products for export; the vegetable oil price index fell by about 5.5 month-on-month, reaching the lowest value since July 2009. The main reason for the decline in palm oil prices was the increase in Southeast Asian production and the slowdown in Malaysia exports, the further weakness in soybean oil prices is due to abundant export supplies in South America and good global supply prospects from 2015 to 2016.

The FAO Food Price Index consists of a weighted average of the international market prices of five food categories: cereals, meat, dairy products, vegetable oils and sugar. (Reporter Ge Chen)

2015-08-07 Source: Xinhua