In February, FAO Food Price Index declined by 1%

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On March 5, the press-service of FAO stated that its Food Price Index fell to its lowest in the past 55 months; 1% down compared with January, and, 14% compared to February, 2014.

According to the report, the lowest fallen index since July, 2010 reflects stability in supply, as well as the weakness of many currencies against the US dollar, favorable production forecasts for certain crops in 2015 and high level of reserves.

During February, the price index for crops amounted 171.7 points, which is 3.2% below the January level. Prices for wheat, forage grain and rice declined; yet wheat prices decline the most as forecasts for 2015 — yields are constantly improving, despite already large global reserves.

February price index for vegetable oils totaled to 156.6 points (+ 0.4% from January). The increase is due to higher prices for palm oil, resulted from declining production volumes in Malaysia and expected sharp increase in consumption in Indonesia due to the increasing subsidies to domestic producers of biodiesel.

Such growth, however, deterred continuing price fall for soybean oil under the influence of a larger-than-expected export supply and the expected record harvest of soybeans in Latin America.

February price index for sugar was 207.1 points (-4.9%). The decrease mainly reflects improving forecast of crop yield in Brazil, as well as announcement made by India to provide export subsidies in order to increase its sales abroad.

In the past month, price index for meat amounted to 187.4 points (-1.4%). The decline was due to the fall in prices for beef and lamb, while poultry prices remained unchanged, and pork prices rebounded after falling for eight months.

FAO’s price index for dairy products was 181.8 points (+ 4.6%). Prices for whole milk powder increased the most; slightly less than the prices for skimmed milk powder and butter; prices for cheese remained unchanged.