The FAO Vegetable Oil Price Index dropped by 19.2% in July compared to the previous month – marking a 10-month low, the Food and Agriculture Organization of the United Nations (FAO) reported.
International prices for all oil types fell, with palm oil prices declining due to prospects of ample export availabilities out of Indonesia, rapeseed oil prices responding to forecasts of ample new crop supplies, and soyabean oil prices down due to ongoing sluggish demand, according to the 5 August report.
Sunflower oil prices also dropped markedly amid subdued global import demand, the FAO said, while lower crude oil prices also put downward pressure on vegetable oil values.
Meanwhile, the FAO Food Price Index (FFPI) averaged 140.9% in July, down 8.6% compared to the previous month. This marked the fourth consecutive monthly decline since hitting all-time highs earlier in the year, the FAO said, although the FFPI remained 13.1% higher than last July.
“The decline in food commodity prices from very high levels is welcome, especially when seen from a food access viewpoint; however, many uncertainties remain, including high fertiliser prices that can impact future production prospects and farmers’ livelihoods, a bleak global economic outlook, and currency movements, all of which pose serious strains for global food security,” FAO chief economist Maximo Torero said.
The prices indexes for cereals, dairy, sugar and meat also decreased by 11.5%, 2.5%, 3.8% and 0.5% respectively compared to the previous month.
The FFPI tracks international prices of a basket of commonly-traded food commodities, while the FAO's vegetable oil price index illustrates the changes in international prices of the 10 most important vegetable oils in world trade, weighted according to their export shares.