ITALY, Rome. World market prices for almost all agricultural products rose sharply in August, especially for beef and poultry meat, as well as sugar and cereals.
World market prices for major agricultural products rose sharply on average in August 2021, following declines in the previous two months. The Food and Agriculture Organization of the United Nations (FAO) said today in Rome that the price index it calculates across all commodity groups considered rose 3.1% from July to 127.4 points. The index was thus again close to the annual high recorded in May and 32.9% above the value of August 2020. According to the FAO, the increase in agricultural prices compared to July is based primarily on the increase in the price of sugar, wheat and palm oil.
The FAO sub-index for sugar rose particularly sharply, by 9.6%. According to market experts, this was due to possible frost damage in Brazil, the world's largest sugar exporter. Price growth was dampened by strong crop prospects in India and the EU, as well as weakness in the Brazilian real. According to the FAO, vegetable oil prices rose 6.7% in the month under review, with palm oil quotations climbing to new record highs at times. Canola and soybean oil prices also rose.
The FAO sub-index for cereals was 3.4% higher than the July figure. World wheat prices rose 8.8% due to reduced harvest volumes in several exporting countries, according to market experts. Corn prices, on the other hand, slipped 0.9% as crop prospects improved in Argentina, the EU and Ukraine.
The FAO Meat Price Index rose slightly in August as strong buying from China supported sheep and beef markets and steady import demand from East Asia and the Middle East boosted poultry meat prices. Pork prices, on the other hand, softened due to a continued decline in Chinese imports and relatively weak domestic demand in Europe.
The FAO dairy subindex was down slightly from July, as international quotations for milk powder declined amid weak global import demand and Oceania's seasonally rising export supply. This discount was not offset by higher butter and cheese prices.