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Sugar, dairy drive up October food prices

/ 02:30 AM November 26, 2016

Global food prices continued to rise in October, with the staple grains index increasing for the first time in three months, according to the Food and Agriculture Organization (FAO).

The United Nations agency, in the latest update of its Food Price Index, said this happened even if the wheat supply outlook improved and the rice outlook remained stable.

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The index is trade-weighted and tracks international market prices for the cereals, vegetable oils, dairy, meat and sugar commodity groups.

For October, the index averaged 172.6 points, up 0.7 percent or 1.2 points from the 171.4 points recorded in September.

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The October figure—the highest in 18 months or since March 2015—was also 9 percent above the 158.2 points reached in September last year.

The index has risen continuously throughout 2016 except for a brief dip in July, the FAO said.

“October’s rise was driven primarily by jumps in sugar and dairy prices,” the agency said.

Meanwhile, world cereal production for 2016 is expected to increase by 1.5 percent to 2.6 billion tons, including 498 million tons for rice.

In a separate report, the Agricultural Market Information System (Amis) said the forecast volume of global output for 2016 was 6 million tons better than in the previous year.

“Rice conditions for Southeast Asia are generally favorable, most notably in India, Indonesia, the Philippines, and Thailand,” the UN-supervised Amis said.

This suggests the continuous hike of Philippine agricultural output, to build on a 3-percent year-on-year growth in the third quarter this year.

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The third-quarter performance followed a 2.3-percent year-on-year decrease in the second quarter, which the Philippine Statistics Authority attributed to the lingering effects of the recent El Niño.

According to the UN, 60 million people worldwide went “food insecure” because of the recent El Niño, including 3.5 million in the Philippines.

In the Philippines, the UN said 42 percent of the country was affected by drought and dry spells, mostly in Mindanao.

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TAGS: FAO, Food and Agriculture Organization, food price index, Global Food Prices, grains, Grains Index, Philippine statistics authority
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