According to the Food and Agriculture Organisation of the United Nations (FAO), world food commodity prices made a significant leap in March 2022 to reach their highest levels ever, driven in part by the war in Ukraine.
The FAO Food Price Index averaged 159.3 points in March, up 12.6% from February when it had already reached its highest level since its inception in 1990.
The Index tracks monthly changes in the international prices of a basket of commonly-traded food commodities. The latest level of the index was 33.6% higher than in March 2021.
Vegetable Oil
The FAO Vegetable Oil Price Index rose 23.2%, driven by higher quotations for sunflower seed oil, of which Ukraine is the world’s leading exporter.
Palm, soy and rapeseed oil prices also rose markedly because of the higher sunflower seed oil prices and the rising crude oil prices, with soy oil prices further underpinned by concerns over reduced exports by South America.
Sugar
The FAO Sugar Price Index rose 6.7% from February, reversing recent declines to reach a level more than 20% higher than in March 2021. Higher crude oil prices were a driving factor, along with currency appreciation of the Brazilian Real, while favourable production prospects in India prevented larger monthly price increases.
Meat
The FAO Meat Price Index increased by 4.8% in March to reach an all-time high, led by surging pig meat prices related to a shortfall of slaughter pigs in Western Europe. International poultry prices also firmed in step with reduced supplies from leading exporting countries following avian flu outbreaks.
Cereal
The FAO Cereal Price Index was 17.1% higher in March than in February, driven by large rises in wheat and all coarse grain prices largely as a result of the war in Ukraine. The Russian Federation and Ukraine, combined, accounted for around 30% and 20% of global wheat and maize exports, respectively, over the past three years.
World wheat prices soared by 19.7% during the month, exacerbated by concerns over crop conditions in the United States of America. Meanwhile, maize prices posted a 19.1% month-on-month increase, hitting a record high along with those of barley and sorghum.
