The FAO Food Price Index (FFPI) averaged 180.5 points in February 2020, down 1.9 points (1.0%) from January but still 13.5 points (8.1%) higher than in February 2019, the UN’s Food and Agricultural Organization said in its monthly report.
The decline marked the first month-on-month drop in the value of the FFPI following four months of successive increases. It was driven by a sharp fall in the export prices of vegetable oils and, to a lesser extent, meat and grains, more than offsetting a continued rise in dairy and sugar prices, the report said.
The FAO Meat Price Index averaged 178.6 points in February, down 3.7 points (2.0%) from January, marking the second month of decline, following 11 months of moderate increases. At this level, the index value was 15.9 points (9.8%) above the corresponding month last year. In February, international prices of sheep meat fell the most, followed by beef, primarily due to reduced imports by China, reflecting delays in cargo handling in ports, which, in turn, led to stock build up in major exporting countries.
Drought-induced slaughter in New Zealand also weighed on international quotations for sheep meat. Current import demand for pork eased from its earlier highs, but some supply tightness in Europe pushed up prices marginally. Poultry meat prices came under slight downward pressure due to lower purchases by Asia.
The FAO noted that, unlike for other commodity groups, most prices used to calculate the FAO Meat Price Index are not available when the FAO Food Price Index is computed and published; therefore, the value of the Meat Price Index for the most recent months is derived from a mixture of projected and observed prices. The practice can, at times, require “significant revisions” in the final value of the FAO Meat Price Index which could in turn influence the value of the FAO Food Price Index.