Lower dairy and meat prices led to a decline in the world Food Price Index for the seventh month in a row, said the UN Food and Agriculture Organization. The index fell by 0.2 percent and is at the lowest level since August 2010. FAO said pig production has recovered in several countries hit by porcine epidemic diarrhea, meaning more pork is available, and cattle herds were expanding in Australia. Meat prices fell by 2.3 percent in October but are still 10 percent higher than a year ago. Dairy prices are down due to larger butter and dry milk output in Europe. Grain prices, stable in October, are down 9.3 percent from one year ago.
The global corn crop is not quite as large as earlier forecast due to dimming prospects for China’s harvest, said FAO’s Cereal Supply and Demand Brief. All the same, corn production was forecast for a record 1.01 billion tonnes, 3.8 million tonnes more than the mark set last year, “on the back of bumper crops in the European Union and United States.” The wheat crop was forecast for 772.6 million tonnes, topping the record crop of 2013. Cereal production was forecast for 2.522 billion tonnes, marginally below the record set last year.
Global cereal inventories are forecast to rise by 8 percent this year, lifting the stocks-to-use ratio to 25.1 percent, the highest ratio in 12 years.