The price of wheat and poultry rose in May this year (2022), despite a modest decline in world food commodity prices throughout the month, according to the Food and Agriculture Organisation of the United Nations (FAO).
The FAO’s Food Price Index tracks monthly changes in the international prices of a basket of common food commodities.
In May 2022, the index averaged 157.4 points which was 22.8% higher than the same month in 2021, but down 0.6% on April of this year.
Focusing on international wheat prices specifically, the price of wheat in May was only 11% lower than the record high which was reached in March 2008.
This comes as a result of an Indian export ban as well as concerns over crop conditions in many leading export countries, combined with reduced production prospects in Ukraine due to the war.
Statistics wise, wheat prices in May were 5.6% higher than in April and were also up 56.2% on the same month in 2021. This resulted in a 2.2% rise in the FAO’s Cereal Price Index between April and May of this year.
Meat price index
The FAO’s Meat Price Index set a record high as it increased by 0.6% in May alone, driven by a steep increase in international poultry prices.
This increase comes even as bovine meat prices remained stable and the international price of pigmeat experienced a significant drop.
These increases in the cost of poultry meat were a knock on effect of disruptions to supply chains in Ukraine due to the war, as well as recent cases of avian influenza during a surge in demand throughout Europe and the Middle East.
However, while international rice prices also rose, however coarse grain prices declined by 2.1%, and there was an even larger drop in maize prices, as crop conditions in the US, Argentina and Brazil improved.
The FAO also noted a 3.5% decline in the Vegetable Oil Price index in May in comparison to April as prices dropped for sunflower, oilseed rape, soy and palm oils due to elevated costs in recent months. Speaking about this index, FAO chief economist Maximo Torero Cullen said:
“Export restrictions create market uncertainty and can result in price spikes and increased price volatility.
“The decrease in oilseeds prices shows how important it is when they are removed and let exports flow smoothly.”