Rabat – The FAO Price Index, Food and Agriculture Organization Price Index, recorded its highest value in October, according to the United Nations’s Food and Agriculture Organization.
The FAO Price Index (FFPI) averaged 133.2 points in October 2021, increasing by four points from September and by 31.8 points from October 2020.
Fueled by the economic fallout of the COVID-19 crisis, the sharp increase of the FFPI reached its highest value since July 2011.
The FFPI recorded in October dwarfs the value that the index recorded at the highest of the global economic crisis of 2007-2008, raising concerns about global food insecurity.
The latest rise in the FFPI is primarily due to the drastic increase in vegetable oil prices worldwide. The prices for vegetable oil and related commodities rose by 62.1 points between 2020 and 2021, marking the highest increase among the five commodities groups within the index.
The sharp increase in oil prices is due to the robust demand in oil imports and the concerns over labor shortage in Malaysia, according to the UN’s Food and Agriculture Organization.
The FFPI subsumes five indexes: the Meat Price Index, the Diary Price Index, the Oils Price Index, and the Sugar Price Index.
The Sugar Price Index, however, dropped by 0.7%, marking the first decline after six consecutive months on the rise. The decrease in the Sugar Price Index is supported by the limited demand for sugar imports and prospects of larger exports from India and Thailand.
The decline in the exchange rate of the Brazilian Real against the US dollars also contributed to the decline of sugar imports, supporting the drop in sugar prices.
The Meat Price Index equally registered a slight drop of 1.8% in September, the third consecutive monthly decline supported by weak market demand in China and concerns over mad-cow disease in Brazil, leading to a further decline in demand.
The decline in the Meat Price Index did not affect poultry prices. The rising global demand for poultry meat coupled with the weak production expansion caused poultry meat prices to increase.
