World food prices at two-year high on rising meat, edible oils

World food commodity prices rose in July to their highest in over two years, as a jump for vegetable oils and record levels for meat outweighed falling cereal, dairy and sugar prices, the United Nations’ Food and Agriculture organization (FAO) said.

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The FAO Food Price Index, which serves as a global benchmark for food commodity prices, averaged 130.1 points in July, a 1.6 per cent increase from June, FAO said.

That was the highest reading since February 2023, though the index was 18.8 per cent below its peak of March 2022, which followed Russia's full-scale invasion of Ukraine.

FAO's meat price index hit a new all-time high of 127.3 points, up 1.2 per cent from its previous peak in June, as strong import demand from China and the United States boosted beef and sheep meat prices, the agency said.

US beef imports have climbed after drought led to a decline in the domestic cattle herd. China shipped in record amounts of beef last year amid growing popularity of the meat, though an official probe into imported beef has raised uncertainty about Chinese demand.

In other meat markets, poultry prices rose slightly following the resumption of imports of Brazilian chicken by major buyers after Brazil regained its avian influenza-free status following action against a first farm-level outbreak.

In contrast, pig meat prices declined due to sufficient supplies and lower demand, particularly in the European Union, FAO added.

The agency's vegetable oil index surged to 166.8 points, up 7.1 per cent month-on-month and the highest level in three years.