Archive: Global food prices falling, driven by dairy

Published 11 September 14

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The latest food price index from the UN Food & Agriculture Organisation (FAO), covering August, fell for the fifth consecutive month, to 196.6 points. This marked its lowest point since September 2010 and is largely due to falling dairy prices in the latest month.

Dairy prices continued to fall in August, with the FAO dairy price index falling to 200.8 points. This was down by 25.3 points (11%) from the previous month – the largest month-on month decrease for six years. Increased global milk supply and easing demand has been behind the downward trend in global dairy commodity prices seen since early 2014, which was made worse in August by the introduction of the Russian trade ban.

With the exception of meat, prices for all other agricultural commodities fell over the month. For dairy, the supply response to lower milk prices will be a key driver of wholesale price movements over the coming months, as well as the timing and extent of buyers, particularly China, returning to the market for long-term purchases.  

FAO dairy index