FAO Food Price Index Increases
The FAO Food Price Index (FFPI) increased to 130.1 points in July 2025. This rise of 1.6 percent from June was mainly due to higher international prices of meat and vegetable oils. Despite this monthly growth, the index remains 18.8 percent below its March 2022 peak. It is, however, 7.6 percent above July 2024 levels.
What is FAO Food Price Index?
- The FFPI measures monthly price changes of a basket of globally traded food commodities.
- It is a weighted average of five commodity groups – cereals, dairy, meat, vegetable oils, and sugar.
- The weights reflect average export shares from 2014 to 2016.
- The index helps monitor global food price trends and assess market conditions.
Cereal Price Trends
Recently, the FAO Cereal Price Index averaged 106.5 points, down 0.8 percent from June. Wheat and sorghum prices fell due to fresh harvests in the northern hemisphere and ample supplies. Maize and barley prices rose slightly, supported by dry conditions in parts of Eastern Europe and reduced exports from Argentina and Brazil. Seasonal harvests and regional weather patterns influenced these movements.
Vegetable Oil Price Surge
The Vegetable Oil Price Index rose sharply by 7.1 percent to 166.8 points, reaching a three-year high. Palm, soy, and sunflower oils saw price increases, driven by strong global demand and tightening export supplies. Palm oil gained from better price competitiveness. Soy oil was boosted by expected biofuel demand in the Americas. Sunflower oil prices climbed due to limited supplies from the Black Sea region. Rapeseed oil prices declined with new European crop arrivals.
Meat Price Index Hits Record High
The Meat Price Index reached an all-time high of 127.3 points, up 1.2 percent from June. Bovine and ovine meat prices rose sharply due to strong demand from China, the USA, and Brazil. Poultry prices increased slightly following Brazil’s recovery from avian influenza. Pig meat prices fell, mainly in the European Union, due to ample supplies and weak demand.
Dairy and Sugar Price Movements
The Dairy Price Index slightly declined by 0.1 percent to 155.3 points. Butter and milk powder prices dropped due to abundant supplies and subdued demand, especially in Asia. Cheese prices continued to rise, supported by strong demand in Asia and the Near East and limited EU exports. The Sugar Price Index fell by 0.2 percent to 103.3 points, marking the fifth consecutive monthly decline. Expectations of higher global sugar production in 2025/26, especially in Brazil, and Thailand, pressured prices despite a rebound in import demand.
Implications
The FFPI’s July 2025 trends reflect complex interactions of supply, demand, weather, and geopolitical factors. Rising meat and vegetable oil prices contrast with declines in cereals, dairy, and sugar. These shifts affect food security, trade balances, and inflation in importing countries. Monitoring such indices is vital for policymakers and stakeholders to anticipate market changes and respond effectively.
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