• January 20, 2021

COVID-19: Vegetable Oil, Sugar, Others ‘Rebound’ in Global Market in June – FAO

The Food and Agriculture Organisation (FAO) of the United Nations has said that global food commodity prices rose in June for the first time since the beginning of 2020.

FAO made the observation in the Food Price Index report published on its website recently.

The index report, which tracks the international prices of food commodities, shows that the most traded food commodities averaged at 93.2 points in June – some 2.4% general increase from May’s.

These increases, FAO said, were primarily driven by a bounce back in vegetable oils, sugar and dairy quotations.

The Vegetable Oil Price Index, for example, gained some 11.3% increase in June after declining for four consecutive months.

“Price quotations of soy, sunflower and rapeseed oils also went up,” the report notes.

While the index price for sugar climbed up by 10.6% in June, that of dairy rose by 4.0% from May’s. The price of palm oil also rose in June, the report acknowledges.

In contrast, the index price of both cereals and meat fell by 0.6%.

FAO explained that the rebound mainly reflects price increases due to recovering global import demand following the easing of COVID-19-related lockdowns in a number of countries.

Also, concerns over possible production setbacks amid prolonged migrant labour shortages is another factor to consider, FAO said.

The report reads in part, “The surge in crude oil prices provided strong support to sugar markets encouraging Brazil’s sugar mills to use more sugarcane supplies to produce ethanol instead of sugar, thereby affecting sugar export availability and prices.

“Renewed import demand for spot supplies, especially from Middle East Asia, coupled with seasonally declining supplies in Europe and limited availability of uncommitted supplies in Oceania, underpinned the recent price increases.

“Downward pressure on wheat prices in June was in part due to new harvests in the northern hemisphere and improved production prospects in a number of major exporting countries including the Black Sea region.”

 

SOURCE: AGRONIGERIA

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