World food prices drop again in April as pandemic reduces demand

7 May  (Xinhua) : World food prices continued to fall in April, the United Nations Food and Agriculture Organization (FAO) reported on Thursday, as the global coronavirus pandemic continued to take its toll on worldwide demand.

The overall index was 3.4 percent lower in April than it was in March, the third consecutive decline for the broad index. FAO said the direct and indirect impacts of the coronavirus pandemic were the main factors behind the downward trend.

Every sub-index lost ground in April, with sugar prices taking the lead by falling 14.6 percent compared to the previous month. FAO said lower fuel prices were the main culprit behind the fall in prices. Prices for grains and cereals — the largest component in the index — fell the least, down around 0.1 percent for the month.

FAO said that rice and wheat prices rose for the month because of higher demand for rice and a slowdown in wheat exports from Russia. But those gains were offset by lower prices for corn, which fell as a result of a strong harvest in Latin America and lower demands for ethanol, a fuel supplement often made from corn.

FAO said vegetable oil prices fell 5.2 percent, mostly due to lower prices for palm and soy oil, while dairy prices slipped 3.6 percent because of lower demands. Meat prices also fell, declining 2.7 percent despite an uptick in demand from China. That was more than balanced by lower demand from other parts of the world, FAO said.

The monthly FAO Food Price Index is based on worldwide prices for 23 food commodity categories covering prices for 73 different products compared to a baseline year.