Global food prices hit highest level since January 2023, FAO says

Global food prices rose in July to their highest level since January 2023, as extreme weather, volatile energy markets and geopolitical tensions pushed up the cost of key agricultural commodities, the UN Food and Agriculture Organization (FAO) said on August 7.

The FAO Food Price Index, which tracks monthly changes in international prices for a basket of major food commodities, increased by 0.6% from June and was 1% higher than a year earlier.

The rise was driven primarily by higher prices for cereals, vegetable oils and sugar, while meat and dairy products became cheaper during the month.

Global wheat prices climbed 5.8% amid disruptions to export flows from the Black Sea region and hot weather affecting major producing countries. Vegetable oil prices reached their highest level since June 2022, supported by strong demand for palm oil in Indonesia and rising crude oil prices.

Sugar prices rose 5.6% as drought in the European Union and the effects of the El Niño weather pattern in Asia raised concerns over supply.

By contrast, meat prices fell by 2.8%, marking their first annual monthly decline in a year, as abundant supplies from Brazil and the European Union weighed on the market. Dairy prices also edged down by 0.7%.

The FAO said the latest increase reflects mounting pressure on global food markets from adverse weather conditions, energy price volatility and continuing geopolitical uncertainty.