The Food Price Index of the Food and Agriculture Organization of the United Nations, FAO, dropped 118 points in January. The variation corresponds to 1.1% in relation to December and 10% in relation to the period of one year.
The UN agency reveals that the drop to the lowest monthly level in almost three years was driven by reductions in the cost of cereals and meat.
Monthly measurement of global prices
In December, the monthly measurement of global prices recorded 119.1 points, the lowest index after February 2021.
Brazil is mentioned among the countries that exerted the most influence on the 1.1% drop in international beef values in January, which happened for the seventh consecutive month.
New fall is led by cereal and meat costs
In the first month of 2024, global meat demand reached a new record in a context of strong global demand for imports, a weak supply of cattle ready for slaughter in the country and a high demand for herd replacement in Australia.
The reduction in meat costs was due to abundant supply from the main exporting countries and reduced international prices for poultry, beef and pork, according to the FAO.
Favorable production prospects
In relation to the sugar category, the improvement in growing conditions in Brazil influenced the 1.9% drop in a context of favorable production prospects in large exporting countries, which include India and Thailand.
Regarding cereals, the prospect of a historic maximum in Brazilian corn production had an influence on the sharp drop in grain prices. Harvesting will begin soon in the Southern Hemisphere.
The drop in costs reflects the improvement in harvest conditions, the start of the harvest in Argentina and an increase in supply in the United States. Production in Argentina and South Africa was above their average levels.
Monthly measurement of global prices registered 118 points in January
The FAO highlights that global wheat export prices declined in January, driven by strong competition among exporters and the arrival of recently harvested supplies in southern hemisphere countries.
Adjustment of global cereal production
The FAO also published the Cereal Production Index predicting a historic record of 2.8 billion tons in 2023, an increase of 1.2% compared to the previous year.
According to the agency, an adjustment in global production of secondary cereals is now expected to reach a record 1.5 billion tons, after an upward adjustment of 12 million tons this month.
The new data is based on records from Canada, China, Turkey and the United States, where a combination of high yields and larger-than-expected harvests supported estimates of rising corn production.