The Russian invasion of Ukraine fueled a sharp rise in food prices last winter, but prices have fallen for 10 straight months, said the UN Food and Agriculture Organization. The FAO Food Price Index, which measures the monthly changes in price for five commonly consumed commodities, declined modestly in January to a reading of 131.2 points, down 28.6 points from the peak last March.
Lower prices for vegetable oils, dairy and sugar pulled down the price index, said the FAO report. Prices for cereal grains and meat were largely stable. Prices for palm, soybean, sunflower and rapeseed oil fell 4.2 points, affected by larger supplies and improved weather.
In a companion report, the FAO said world wheat production would rise by 2 percent this year, to 793.7 million tonnes, due to larger plantings in the United States, Canada, the EU and India. Low domestic prices could result in a small cutback in wheat sowing in Russia, the No. 1 exporter, said the FAO.
“In Ukraine, severe financial constraints, infrastructure damage and obstructed access to fields in parts of the country have resulted in an estimated 40 percent year-on-year reduction in the 2023 winter wheat area,” said the FAO.