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Global food commodity prices decline in ’19 owing to lower cereal prices
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Monday, 05 August, 2019, 15 : 00 PM [IST]
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Rome
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Global food commodity prices saw a slight decline in July 2019, led by lower prices for some cereals, dairy and sugar, more than offsetting firmer prices for meat and oils.
The FAO's Food Price Index (FPI) - a trade-weighted index that measures prices of five major food commodities on international markets - averaged 170.9 points in July 2019, slipping 1.1 per cent below its level in June but up 2.3 per cent from a year earlier.
The FAO Cereal Price Index dropped by 2.7 per cent from June but is 4.1 per cent above its level in July last year. The overall decline was mainly driven by a slide in wheat and maize prices, reflecting, among others, ample export supplies. By contrast, the rice index marked its fifth successive month of stability amid generally quiet market activity.
The FAO Vegetable Oil Price Index rose by 0.8 per cent in July led by firmer soy and sunflower oil prices that balanced out a further drop in palm oil values. The decline of the latter was largely driven by continued seasonal surge in crop production in Southeast Asia combined with sluggish global import demand.
The FAO Meat Price Index posted a 0.6 per cent increase from its slightly revised value for June, marking its sixth month-on-month price increase.
Ovine and bovine meat prices rose further in July, boosted by robust import demand from Asia and weakening supplies from Oceania due to a seasonal decline. On the other hand, prices for pig meat dropped slightly after four months of continued increases, reflecting larger export availabilities from Brazil and the United States.
The FAO Dairy Price Index declined by 2.9 per cent from June, representing the second consecutive monthly drop, led by a decline in butter quotations followed by cheese and whole milk powder.
The FAO Sugar Price Index declined by 0.6 per cent from June 2019, mainly driven by expectations of higher sugarcane yields in India, the world's largest sugar producer. The decline in world prices was partially contained by a strengthening of the Brazilian Real against the US dollar, a move that tends to restrain exports from Brazil, the world's largest sugar exporter.
Qu takes over
Qu Dongyu marked his first day in office as director general of FAO of the United Nations by outlining some of his priorities, including stepping up global efforts to achieve Zero Hunger and spearheading initiatives that focus on making agriculture more sustainable.
Qu began by greeting staff at the agency's Rome headquarters and visiting them in their individual offices.
“Let’s work together, learn together and contribute together for the benefit of FAO’s member countries,” he told FAO staff.
Qu, a former vice-minister of agriculture and rural affairs of China, in June won elections to lead the Rome-based agency. He has stressed the crucial role that FAO, which has 194 member states, can play in addressing key global challenges.
These include increasing rates of hunger and malnutrition; climate change-related risks to agriculture; ongoing natural resource depletion and environmental pollution; and, the growing spread of trans-boundary animal and plant pests and diseases.
Targeted action
In particular, Qu called for urgent actions to achieve Zero Hunger and targeted poverty eradication, while driving agricultural and rural sustainable development through innovation, including digital.
He has urged for a special focus on strengthening agriculture in tropical and dryland areas, which are home to some of the most vulnerable populations in the world.
The new director general has also pointed to the importance for FAO to scale up new partnerships and cooperative mechanisms, including with other UN agencies, governments, business, and academia and research institutes.
Strengthening and expanding development cooperation between countries
In this context, Qu has stressed the need for FAO to encourage developed countries to match their strengths in terms of funds, technology and management with those of developing countries, such as land and workforce resources.
Noting that hand-in-hand development cooperation between countries of the global South should be expanded, he added that FAO's South-South Cooperation (SSC) portals could further facilitate and promote the sharing of agriculture development concepts, policy measures, practical technologies and farmers' innovations.
Qu has also underscored FAO's contribution to SSC by bringing together different partners, including the public sector, financial institutions, and non-governmental organisations to forge consensus for more extensive cooperation.
Building on FAO's strengths
The FAO chief has referred to the agency’s work and experience in creating and sharing critical information about food, agriculture and natural resources in the form of global public goods and build up its strengths in collecting and disseminating such knowledge globally.
Furthermore, he added that FAO should foster its strength in global normative work and reinforce its position a global response centre for food and agricultural crises in collaboration with other international organisations, while taking on a more full-fledged role in the capacity building of its member countries.
To achieve these objectives, Qu pledged to forge FAO into an international organization with world-class internal governance. This will mean placing special attention to the youth working at the UN agency, but at the same time recognising the value and the experience of senior staff.
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