Food commodity prices for January 2016 dropped by 16% on January last year, the latest figures from the Food and Agriculture Organisation (FAO) show.

The FAO Food Price Index (FFPI) averaged 150.4 points in January 2016, which compared to December 2015 was down almost 3 points (1.9%).

The prices of all the commodities tracked by the index fell, with sugar and dairy products registering the steepest declines.

Looking at the dairy price index, it was down 3% from December to 145.1 points.

The FAO attributes the decline to large winter milk production in the EU, better than anticipated availability in Oceania (New Zealand and Australia) and sluggish import demand.

Whole Milk Powder (WMP) was the most affected dairy product.

Meanwhile, looking at the meat price index, it suffered less of a decline (1.1%) with the index averaging at 148.3 points.

Prices for all meat categories fell with the exception of pigmeat where prices were offset by the opening of the EU aid scheme in January.

Sheepmeat prices were sharply lower which the FAO attributes to the beginning of the peak production period in Australia and New Zealand.

Looking at beef and poultry prices, lacklustre demand weighed on these prices, according to the FAO.

Sugar prices also registered a decline in points of 4.1% to 199.4 points, the first after four months of steady increases.

The decrease was started by better than expected crop conditions in Brazil, the world’s leading sugar producer and exporter.

Both cereal and vegetable oil prices also declined by 1.7% each to 149.1 and 139.1 points respectively.

International wheat and maize prices continue to be affected by ample global supplies, increased competition for export markets and a strong US Dollar.

The slide in vegetable prices was mainly caused by a marked drop in soy-oil prices, the FAO has said, reflecting expectations of ample global soybean supplies, notwithstanding lower than earlier anticipated production in the United States and Brazil.