The Cereal Price Index averaged 245 points in September, a 3% decline compared with August. The Cereal Index has followed a downward trend since April, largely due to the expectation of a strong rebound in world cereal production, according to the FAO.
“While a tight maize supply prospect and policy changes in rice provided support, the index fell in September reflecting generally improved supply prospects, expectations of slowing demand and the strengthening U.S. dollar,” the FAO said.
From a historical perspective, the Oils/Fats Price Index remains high at 238 points, but it also declined 2.3% when compared with August. The FAO noted the recent declines in the Oils/Fats Index represent comfortable levels of palm oil in Southeast Asia combined with growing export supplies of sunflower oil following good harvests in the Black Sea region.
The Dairy Index experienced a slight decline compared to August, falling from 221 points during that month to 218 during September. Butter prices suffered the sharpest drop, losing 3%, followed by casein and cheese, which retreated by about 1% each. Prices of whole milk powder were virtually unchanged. The prices of all dairy products remain, on average, 10% higher than the corresponding period last year, according to the FAO
A 3% decline in pork prices led to a slight decline in the Meat Price Index to 175 points. Poultry prices also fell, but marginally, while prices of beef and sheep meat trended slightly upwards amid tight supplies. Despite the recent weakness, all meat prices remain above the levels prevailing in 2010, with the index up 14% from September 2010, mostly a reflection of rising costs and low inventories.
The Sugar Price Index was 379 points in September, a 3.8% decline when compared with August. The FAO said positive production prospects in Europe, India and Thailand contributed to the decline.