FAO Food Price Index
Chart of the Week for May 15, 2015 - May 21, 2015
The Food Price Index ("Index") of the United Nations Food and Agriculture Organization ("FAO") is one indicator of international food prices. It measures monthly price changes for a basket of food commodities in five basic groups: cereals, dairy, meat, vegetable oils, and sugar. Food prices have a greater impact on emerging countries, where spending on food consumes a much larger portion of household budgets than in the U.S. and other developed countries. Global food prices, as measured by the Index, hit record levels in 2011.
Since 2011, food prices have been gradually declining. The latest FAO report showed that global food prices decreased 1.2 percent in April 2015, and are down 19.2 percent year-over-year compared to April 2014. The Index is at its lowest level since June 2010 due largely to plentiful supplies, lower freight rates, and lower demand due to weak emerging market currencies. According to FAO, dairy prices have fallen the most recently. Sugar, cereals, and vegetable oils have also declined. Meat values rose in April, the first increase since August 2014.
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