World food prices rebound in August

In August, the United Nations' Food Organization and Agriculture (FAO) report showed a swift rebound in world food prices, marking a 3.1% increase from July and a 32.9% increase from the same period in 2020. This surge was primarily driven by significant price hikes in sugar, wheat, and vegetable oils. The FAO Sugar Price Index experienced a 9.6% rise due to concerns over crop damage in Brazil, while the Vegetable Oil Price Index increased by 6.7% because of concerns over production and falling stocks in Malaysia. The Cereal Price Index also rose by 3.4%, with wheat prices surging by 8.8% due to anticipated reduced harvests in major exporting countries. In contrast, maize prices fell slightly due to improved production forecasts in other regions. The Meat Price Index saw a slight increase, driven by beef and sheep meat purchases in China, while the Dairy Price Index experienced a slight decline. Despite concerns about potential production reductions, the FAO forecasts that global cereal production in 2021 will be 0.7% higher than the previous year, with rice production expected to reach a record high. However, global cereal utilization is projected to increase by 1.4% in 2021/22, and the July forecast for world cereal stocks at the end of the 2022 seasons has been lowered due to dry weather expected to affect wheat stocks.