ROME, ITALY — Global food prices rose in January for the seventh straight month led by cereals, which saw a sharp 7.1% increase, according to the Food and Agricultural Organization (FAO)

The FAO’s Food Price Index, which tracks monthly changes in the international prices of commonly traded food commodities and was released on Feb. 4, averaged 113.3 points in January, marking a 4.3% increase from December 2020 and reaching its highest level since July 2014.

The FAO Cereal Price Index increase was led by international maize prices, which surged 11.2% and are now 42.3% above their January 2020 level, reflecting increasingly tight global supply amid substantial purchases by China and lower-than-expected production and stock estimates in the United States as well as a temporary suspension of maize export registrations in Argentina.

Wheat prices rose 6.8%, driven by strong global demand and expectations of reduced sales by the Russian Federation when its wheat export duty doubles in March 2021, according to the FAO. Robust demand from Asian and African buyers underpinned strong rice prices.

The FAO Vegetable Oil Price Index increased by 5.8% in the month to its highest level since May 2012. Drivers included lower-than-expected palm oil production in Indonesia and Malaysia due to excessive rainfall and ongoing shortages in the migrant labor force, and prolonged strikes in Argentina reducing export availability for soy oil.

The FAO also issued on Feb. 4 the Cereals Supply and Demand Brief, a regular update on global production, consumption, trade and inventory trends.

On the production side, the FAO’s new estimates for 2020 point to record wheat and rice production. Looking ahead to 2021 cereal output, early prospects indicate a likely modest increase for winter wheat crops in the Northern Hemisphere, buoyed by acreage increases in France, India, the Russian Federation and the United States. Maize output in the Southern Hemisphere is expected to decline somewhat in Argentina and Brazil from record highs but remain above average levels. The production outlook in South Africa and neighboring countries is favorable.

At the same time, this month’s forecasts point to larger volumes of world trade and a sharp decline in global cereal stocks.

Globally, cereal utilization in 2020-21 is now forecast at 2.761 billion tonnes, up 52 million tonnes from the previous season. Leading the increase is robust use of coarse grains for feed in China. Worldwide utilization of wheat and rice are forecast to rise by 0.7% and 1.8%, respectively, during the year ahead.

The FAO said global cereal stocks are forecast to decline by 2.2% to 801 million tonnes, their lowest level in five years. That would bring the world stocks-to-use ratio of cereals down to 28.3%, a seven-year low. The new figures reflect a massive downward adjustment to maize inventories in China.

World cereal trade in 2020-21 is now forecast at 465.2 million tonnes, a hefty 5.7% expansion from the previous season’s record high. The raised estimates reflect large purchases of maize by China, particularly from the United States. International trade in rice is anticipated to expand even more, by 7.9%, reflecting strong growth of exports by India.

The new FAO forecasts incorporate the results of a review — back to 2013-14 — of the maize supply-and-demand sheet for China. The country’s unexpectedly large purchases of maize in recent weeks point to a much higher demand for feed and lower domestic supplies than earlier anticipated, which is likely linked to the swift recovery in pork production after the African swine fever outbreak.