Global food prices continued to rise in March for the second consecutive month, driven primarily by soaring energy prices linked to the escalating conflict in the Middle East, according to the latest report from the Food and Agriculture Organization of the United Nations (FAO) published on April 3. The FAO Food Price Index, which measures monthly changes in the international prices of a basket of food commodities traded on global markets, averaged 128.5 points, a 2.4% increase compared to February and a 1% year-on-year rise.
Vegetable oils saw the most significant gains, with the index rising 5.1% since February and 13.2% year-on-year. Prices for palm, soybeans, sunflower, and rapeseed all increased, reflecting the impact of high oil prices and expectations of increased demand for biofuels. The sugar index jumped 7.2%, driven by expectations of increased use of sugarcane in Brazil for ethanol production, despite favorable harvests in India and Thailand.
Cereal prices also rose, with the corresponding index increasing by 1.5% over the month, driven by wheat (+4.3%) due to droughts in the United States and the prospect of reduced plantings in Australia linked to higher fertilizer costs. Corn remained stable thanks to sufficient global supply, while rice prices fell by 3% in March, due to harvest timing, weaker import demand, and the depreciation of some currencies against the dollar.
The meat price index rose by 1% due to increased pork prices in the European Union and higher beef prices in Brazil, while lamb and poultry prices fell, hampered by logistical constraints in the Middle East. Dairy products saw moderate growth (+1.2%), driven by higher milk powder prices in the Southern Hemisphere, while cheese prices varied across regions.
