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BusinessDay

Global food prices surged second consecutive month in April

Food prices are on the rise despite the naira rally as the US set to issue T-bills

Global food prices rose for the second consecutive month in April after a seven-month decline as prices of meat and vegetable oil outweighed the decrease in sugar and dairy prices, the Food and Agriculture Organisation (FAO) said.

The food price index, which tracks changes in the international prices of a set of globally traded food commodities, averaged 119.1 points in April, up 0.3 percent from March 118.3 points. It declined 7.4 percent from the equivalent month of 2023 (128.7 points).

The intentional agency’s meat price index, a leading driver of the uptick, rose 116.3 points from its 113.0 points (1.6 percent) in the previous month, marking its third consecutive increase since February.

However, it declined 0.4 percent from 116.8 points recorded a year ago.

“In April, international poultry meat prices rose, underpinned by steady import purchases by Middle East countries amid the continued challenges to production stemming from avian influenza outbreaks,” the report stated.

“World bovine meat prices also increased, driven by the continued high demand from major importers, notwithstanding increased supplies from domestic sources in leading importing countries,” it added.

The vegetable price index plunged 0.3 percent to 130.9 percent from 130.6 percent in March, marking a 13-month high since April 2023. It soared 0.7 percent from 130.0 in the same month of 2023.

“The marginal increase reflects the net effect of higher sunflower and rapeseed oil quotations, more than offsetting slightly lower palm and soyoil prices,” the international report said.

It noted that international sunflower and rapeseed oil prices rose, underpinned by continued firm global import purchases and unfavourable weather conditions in certain parts of Europe that affected the growth of rapeseed.

The agency’s sugar price index declined 4.4 percent from March 133.1 points to 127.5 points in the period under review, its second consecutive monthly decline. Sugar prices declined 14.7 percent from 149.5 points in the same month a year ago.

The decrease in sugar prices was because of improved global supply prospects, hinged on outstanding outputs in India and Thailand, two top world suppliers of the item.

“Improved rainfall in Brazil in late March and early April, after a prolonged period of dry weather conditions, eased concerns over prospects for the recently started harvest and contributed to the month-on-month price decline.”

The FAO dairy price index for April decreased 0.3 percent to 123.7 points from 124.0 points in Marc, the first decline of the item in six months. It declined 4.3 percent below its value in the corresponding period last year.

The report noted that the decline in prices of dairy products was due to the reduction of prices of skim milk powder in the international market.