World food prices reach 19-month high in November on surging vegetable oil

LONDON – The United Nations’ world food price index rose in November to its highest level since April 2023, recording its biggest gain in 19 months on the back of surging vegetable oil prices, data showed on Dec 6.

The price index, compiled by the UN Food and Agriculture Organisation (FAO) to track the most globally traded food commodities, increased to 127.5 points in November from a revised 126.9 points in October, the highest level in 19 months and up 5.7 per cent from a year earlier.

The vegetable oil index jumped 7.5 per cent above levels seen a month earlier and 32 per cent above those seen a year earlier, driven by concerns over lower-than-expected palm oil output due to

excessive rainfall in South-east Asia

.

Soya oil prices rose on stronger global import demand, while rapeseed and sunflower oil also increased.

Other food price indexes declined.

Cereal prices dropped 2.7 per cent from October, thanks to weaker wheat and rice prices, while sugar fell 2.4 per cent from October as India and Thailand began crushing and concerns over Brazil’s crop prospects eased.

In a separate report, the FAO trimmed its forecast for global cereal production in 2024 from 2.848 billion metric tonnes to 2.841 billion, a 0.6 per cent decline from 2023 but still the second-largest output on record.

World cereal utilisation, meanwhile, is set to increase 0.6 per cent to 2.859 billion tonnes in 2024/25, thanks to growing consumption.

As a result, the FAO expects the cereal stocks-to-use ratio to fall to 30.1 per cent at the close of the 2025 season from 30.8 per cent previously, but still indicating a “comfortable level of global supply”. REUTERS