The UN Food and Agriculture Organization, or FAO, said on Friday that global food prices in August reached their highest level since late 2022, amid extreme weather and trade disruptions tied to wars in the Gulf and Black Sea regions. The agency cited concerns about supplies of staple crops.
Agricultural markets face mounting pressure from sharp temperature increases and droughts in Europe, as well as risks from the El Niño climate pattern. Trade disruptions have also resulted from the war in Ukraine and Iran-related tensions, the FAO said.
These factors pushed grain prices to their highest level in three years, while sugar prices reached their highest level in one year. The FAO's food price index, which tracks monthly changes in prices for a basket of globally traded food commodities, reached 133.3 points in August, compared with a revised 130.8 points in July.
The August reading is the highest since November 2022, but remains about 17 percent below the record high of 133.3 points the index recorded in March 2022, following Russia's full-scale invasion of Ukraine. Maximo Torero, the FAO's chief economist, said the August increase in global food prices indicates risk premiums are returning to food markets.
All of the FAO's main food commodity indices rose in August, including cereals, vegetable oils, sugar, meat and dairy products.
