Food prices grow for second month in global index

The food price index of the Food and Agriculture Organization of the United Nations (FAO) grew for the second consecutive month driven by robust increases in grains and dairy prices.

In March, the Index averaged 172.8 points, 1.1 percent higher than in February and 0.7 percent above its value a year earlier.

“Declines in price quotations for sugar and most vegetable oils were more than offset by increases for maize, wheat and most dairy products. The trade-weighted price index tracks international market prices for five major food commodity groups.

Worldwide cereal production hit a record level in 2017, up 33 million tonnes from 2016, to nearly 2 646 million tonnes, according to FAO’s latest estimate in the Cereal Supply and Demand Brief, also released today. However, FAO’s anticipates this year’s world maize and wheat production to decline based on early forecasts,” said the organization in a press release.

FAO expects global wheat output to fall by 750 million tonnes, about one percent below its near-record level of the previous year.

The organization’s latest forecast for world cereal stocks at the close of crop seasons ending in 2018 stands at nearly 748 million tonnes, almost 4 percent higher than a year earlier and hitting a record level, with the increase led by wheat.

Locally, the inflation has gone on an upward trend starting the end of 2017, leading to an increase of food prices. The central bank expects the inflation rate to stabilize around 5 percent this year.