World food commodity prices make 'significant leap'

By Michelle Perrett

- Last updated on GMT

Commodity prices are increasing
Commodity prices are increasing

Related tags: Supply chain

World food commodity prices made a “significant leap” in March to reach their highest levels ever as the war in Ukraine spread shocks through markets for staple grains and vegetable oils, the Food and Agriculture Organization of the United Nations (FAO) in its Food Price Index has reported.

The Russian Federation and Ukraine, combined, have accounted for around 30% and 20% of global wheat and maize exports, respectively, over the past three years. 

The Index tracks monthly changes in the international prices of a basket of commonly-traded food commodities. It averaged 159.3 points in March, up 12.6% from February when it had already reached its highest level since its inception in 1990. 

The FAO Cereal Price Index was 17.1% higher in March than in February, driven by large rises in wheat and all coarse grain prices largely as a result of the war in Ukraine. 

World wheat prices soar

World wheat prices soared by 19.7% during the month, exacerbated by concerns over crop conditions in the USA.

Meanwhile, maize prices posted a 19.1% month-on-month increase, hitting a record high along with those of barley and sorghum.

Vegetable oils also saw price rises in the wake of the war as Ukraine is the world’s leading exporter of Sunflower seed oil.

The FAO Vegetable Oil Price Index rose 23.2%, with palm, soy and rapeseed oil prices also rising markedly as a result of the higher sunflower seed oil prices and the rising crude oil prices. 

Sugar, meat and dairy prices up

Meanwhile, the FAO Sugar Price Index rose 6.7% from February, reversing recent declines to reach a level more than 20% higher than in March 2021. 

The FAO Meat Price Index increased by 4.8% in March to reach an all-time high, led by surging pig meat prices related to a shortfall of slaughter pigs in Western Europe. 

The FAO Dairy Price Index rose 2.6% and was 23.6% higher than in March 2021, as quotations for butter and milk powders rose steeply amid a surge in import demand for near and long-term deliveries, especially from Asian markets. 

Related topics: Supply Chain

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