DUSHANBE, April 6, 2015, Asia-Plus – The UN Food and Agriculture Organization (FAO) notes that the FAO Food Price Index continued to decline in March, dropping 1.5 percent from February and 18.7 percent (40 points) below its level a year earlier.
A sharp fall in the price index for sugar – which reached its lowest level since February 2009 – together with dipping prices for vegetable oils, cereals and meat, more than offset a rise in dairy prices and contributed to the lower index, which in March averaged 173.8 points.
The index has reportedly been on a downward path since April 2014.
The FAO Food Price Index is a trade-weighted index that tracks prices of five major food commodity groups on international markets. It aggregates price sub-indices of cereals, meat, dairy products, vegetable oils and sugar.
The FAO Cereal Price Index averaged 169.8 points in March, down 1.1 percent from February and as much as 18.7 percent below its level a year earlier. The downward trend in 2015 has been mainly due to large export supplies and mounting inventories, in particular for wheat and maize.
The cereal output estimate for 2014 was reportedly raised to 2 544 million tons mainly due to a larger than anticipated maize harvest in the European Union, according to FAO”s latest
Cereal Supply and Demand Brief
. If confirmed, global cereal output in 2014 would outstrip the 2013 record by 1 percent.
Looking ahead to the 2015 season, global wheat production is expected to reach 722 million tons in 2015, around 1 percent below the current estimate for 2014, mainly due to reduced plantings in the EU. While China, India and Pakistan are all expected to harvest close to 2014”s record levels, production is predicted to decline in the Russian Federation and Ukraine.
FAO”s forecast for world cereal utilization in 2014/15 has been raised by nearly 17 million tons since March, to 2,493 million tons. The increase largely reflects historical revisions in China and India.
The forecast for world cereal stocks by the close of crop seasons ending in 2015 has also been revised up sharply since last month”s report and now stands at 645 million tons. The increase mainly reflects upward revisions to wheat and maize stocks in China.
Based on the current forecasts for cereal stocks and utilization, the cereal stocks-to-use ratio is expected to reach 25.9 percent in 2014/15, its highest value since 2001/02.
