Global food prices fell slightly during October, with weak demand for imports contributing to a decline in monthly prices for grains, dairy products and meat, but they remained about 6 percent higher compared to the same period last year, according to what the Food and Agriculture Organization of the United Nations (FAO) announced on Friday.
The FAO Food Price Index, which tracks monthly changes in international prices of a basket of food commodities, averaged 133.9 points in October, compared to 135.6 points after the review in September.
The index recorded an increase of 5.9 percent compared to the same period last year, but it remained 16.4 percent lower than its peak recorded in March 2022.
The FAO Cereal Price Index fell by 4.5 percent compared to September, and by 12.6 percent year-on-year, with wheat and maize prices declining.
Wheat prices fell due to weak demand for imports and improved production prospects, especially in Argentina.
The FAO said in a statement: “Expectations of easing restrictions on export flows through the Black Sea contributed to increasing downward pressure on prices, although the continuing logistical disruptions in the region limited this decline.”
Corn prices also declined after reaching their highest level in three years in September, affected by the harvest season in the United States, expectations of abundant supplies in South America, and renewed hopes for easing tensions in the Black Sea region.
In contrast, vegetable oil prices increased by 0.3 percent. The rise in soybean and sunflower oil prices offset the decline in rapeseed oil prices.
Sugar prices rose by 6.6 percent, recording the fourth monthly increase in a row, reaching their highest levels since December 2024, after rains disrupted harvesting operations in Brazil. Thus, prices became 28.8 percent higher compared to their levels a year ago.
The dairy products price index decreased by 1.1 percent, with the impact of the decline in butter and cheese prices, as a result of abundant supply and weak demand, exceeding the gains in milk powder prices.
The meat price index also fell by 1.2 percent, although it remained slightly higher than its level a year ago, with the prices of pork, sheep and cattle falling.
Uncertainty about economic growth prospects, and expectations that inflation will continue to rise over the next year, cast a shadow over global markets, despite hopes that the possibility of de-escalation in the Iranian war will lead to a decline in oil prices.
Government borrowing costs have risen sharply this year, while the Nasdaq index, which is dominated by technology companies, recorded its largest daily decline on Thursday since the selling wave that followed the announcement of “Liberation Day” in April 2025. European economic data also showed further weakness, according to Reuters.
The combination of these factors reinforces fears that inflation will remain at high levels, even as economic growth slows. On the other hand, the Democrats' victory in the US midterm elections raised hopes of the possibility of eventually ending the Iranian war.
Oil is still high
Oil prices fell by about 15 percent this week, settling just below $100 per barrel. But analysts warn that a settlement to the Iran war remains uncertain. Which leaves the way open for prices to return to rising.
Despite the recent decline, oil prices are still 64 percent higher since the beginning of the year, while natural gas prices are stable at about three times their levels recorded at the beginning of 2026.
These conditions keep near-term inflation expectations high, and reinforce fears of continued price pressures in conjunction with a slowdown in growth. Which may prompt central banks to continue raising interest rates.
Energy costs and their effects on inflation have risen.
Inigo Fraser-Jenkins, chief investment strategist at Alliance Bernstein, said that geopolitical tensions and supply disruptions that fuel inflationary pressures will continue even after the US midterm elections.
Food prices increase pressure
Food prices, pushed up by extreme weather, shipping disruptions and rising energy costs, remain a major concern about inflation.
The Food and Agriculture Organization of the United Nations (FAO) food price index recorded its highest level in nearly four years.
Tightening financing conditions
Analysts see tightening financial conditions as an additional reason for caution about economic growth prospects.
The repercussions of the wave of technology selling
The decline in high-risk assets, especially AI-related stocks, is another indicator of tightening financial conditions.
Weaker economic indicators
Economic growth in the euro zone slowed sharply in October, with demand approaching stagnation, while rising costs pressured businesses and confidence fell to its lowest levels in five months, according to data released on Wednesday.
