Global food commodity prices climbed in July to their highest level in more than two years, driven by surging vegetable oil costs and record-high meat prices, which offset declines in cereals, dairy and sugar, data showed on Friday.
The United Nations' Food and Agriculture Organization (FAO) Food Price Index, which serves as a global benchmark for food commodity prices, averaged 130.1 points in July, a 1.6% increase from June, FAO said.
That was the highest reading since February 2023, though the index was 18.8% below its peak of March 2022, which followed Russia's full-scale invasion of Ukraine.
FAO's meat price index hit a new all-time high of 127.3 points, up 1.2% from its previous peak in June, as strong import demand from China and the United States boosted beef and sheep meat prices, the agency said.
U.S. beef imports have climbed after drought led to a decline in the domestic cattle herd. China shipped in record amounts of beef last year amid growing popularity of the meat, though an official probe into imported beef has raised uncertainty about Chinese demand.
In other meat markets, poultry prices rose slightly following the resumption of imports of Brazilian chicken by major buyers after Brazil regained its avian influenza-free status following action against a first farm-level outbreak.
In contrast, pig meat prices declined due to sufficient supplies and lower demand, particularly in the European Union, FAO added.
The agency's vegetable oil index surged to 166.8 points, up 7.1% month-on-month and the highest level in three years.
This increase was driven by higher quotations for palm, soy, and sunflower oils due to robust global demand and tightening supplies, though rapeseed oil prices fell as new-crop supplies arrived in Europe, FAO said.
FAO's cereal price benchmark eased to its lowest in almost five years, reflecting seasonal supply pressure from wheat harvests in the Northern Hemisphere.
Its separate rice index dropped 1.8% last month, driven by ample export supplies and weak import demand.
Dairy prices edged down for the first time since April 2024, with declines for butter and milk powders offsetting further gains for cheese.
FAO's sugar price index eased for a fifth consecutive month on expectations of increased production in Brazil and India, despite indications of recovering global sugar import demand, the agency said.
FAO did not update its cereal supply and demand estimates this month.
