(Johannesburg = Yonhap News) Correspondent Na Confirmation = The world food price index rose for three consecutive months.
The Food and Agriculture Organization of the United Nations (FAO) analyzed that upward pressure is being placed on food prices due to weather factors such as heat waves, drought, and El Niño, combined with logistics disruptions caused by the ongoing war in Ukraine and Iran.
The September world food price index announced by FAO on the 2nd (local time) was 136.0, up 1.5% from the previous month in August (134.0). The August index was initially announced as 133.3, but was later adjusted.
The September index rose 5.8% compared to the same month last year, and is the highest level since November 2022 (136.0).
“Transport disruptions in the Strait of Hormuz and the Black Sea, combined with climate shocks, are putting pressure on energy, transport and key food commodity prices, leading to a sustained and increasingly widespread rise in global commodity prices,” said FAO Chief Economist Maximo Torero.
“If these pressures continue, they will soon be passed on to consumer food prices, and the impact will be particularly noticeable in countries that are highly dependent on food and energy imports,” he said.
FAO investigates international price trends for 24 items and compiles and announces the food price index every month for five product groups: grains, oils, meat, dairy products, and sugar.
The index is a number compared with the average price from 2014 to 2016 set to 100.
This year's index started at 124.1 in January and showed an upward trend, reaching 131.0 in April, then falling to 130.1 in June, but turning upward again in July.
However, it falls short of the record high reached in March 2022 (160.2) due to the aftermath of Russia's invasion of Ukraine.
Among the five product groups, the September index rose for grains, oils, and sugar, while meat and dairy products fell.
In particular, the sugar price index in September rose 6.1% compared to August. It rose 14.7% compared to September last year. The rise was driven by the outlook that global sugar supply will become tighter in 2026/27.
Major factors included a decrease in sugar production in Thailand due to lower-than-normal rainfall and the strengthening El Niño phenomenon, the prospect of worsening crop conditions in India, heavy rain in the sugarcane growing areas of south-central Brazil, and a decrease in the sugar beet cultivation area in the European Union (EU).
The grain price index also rose 5.1% from August, and averaged 17.2% higher than September of last year.
Global wheat prices rose 6.3%, reaching the highest level since August 2023. Logistics constraints in the Black Sea region and dry weather ahead of sowing in some parts of North America had an impact.
Corn prices rose 5.6% from the previous month. Concerns about the U.S. harvest outlook, a decrease in Brazil's exportable volume, and disruptions in Black Sea grain trade were factors contributing to the increase.
Continued uncertainty surrounding shipping through the Strait of Hormuz has placed additional upward pressure on prices of biofuel crops such as corn.
The rice price index rose 1.4%. This is due to a combination of weather concerns and a seasonal decrease in supply while the price of indica rice has risen.
The vegetable oil price index rose 0.9% from August. Compared to September last year, it rose 18.3%. Palm oil prices have risen as global import demand has strengthened, reflecting concerns about the impact of dry weather in Southeast Asia on production prospects.
On the other hand, the meat price index fell 1.1%. The main reason is that prices of pork and poultry have fallen as exportable quantities have increased.
The dairy price index fell 0.1% in September. The decline in cheese prices slightly offset the rise in powdered milk prices, and butter prices did not change significantly.
