ROME – The Food and Agriculture Organization Food Price Index averaged 215 points in February, up 2.4 points, or about 1 percent, from the revised January figure.
The food price index consists of the average of five commodity group price indices (meat, dairy, cereals, oils and fats, and sugar) weighted with an average export share of each of the groups for 2002-2004. The FAO said of the February results, “The increase … was mostly driven by higher prices of sugar, oils and cereals while dairy prices fell slightly after a marked rise in January.”
The meat price index averaged 175 points in February, virtually unchanged from January but up from 171 points a year ago. The FAO said pig meat prices gained 3.4 percent behind strong purchases by Hong Kong and recent disease outbreaks in Russia.
The FAO cereal price index averaged 227 points in February, up 4.4 points, or 2 percent, from January and compared with 259 in February 2011.
“International wheat prices rose most followed by maize, while rice quotations were generally lower,” the FAO said. “Wheat markets were supported by tightening supplies and concerns over the impact of severe cold weather on this year’s crops in Europe and the CIS. Maize prices also rose in February, mainly driven by stronger import demand in Asia and supported by weaker dollar and lower freight rates as well as concerns about crop prospects in South America. However, rice prices remained under downward pressure on generally weak import demand and stiff competition among exporters.”
The FAO oils and fats index at 239 points was up 5 points, or 2 percent, from January. In February 2011, the index stood at 281 points.
“Poor monthly production growth in palm oil, together with the prospect of a tight supply and demand balance for total vegetable oils in 2011/12 have driven up the index,” the FAO said. “In particular, lower production forecasts for soy oil, which push down expected global soy oil export availabilities to a multi-year low, have supported prices.”
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