World food prices steady in January, cereal output seen at record high: UN’s FAO

ROME-Reuters

World food prices held steady in January from the month before and global cereal production for 2017 looks set to hit an all-time record high, the U.N. food agency said on Feb. 1.

Rising prices for cereals and vegetable oils were balanced out by lower quotations for dairy and sugar in January, the Food and Agriculture Organization’s (FAO) said.

The FAO’s food price index, which measures monthly changes for a basket of cereals, oilseeds, dairy products, meat and sugar, averaged 169.5 points, nearly unchanged from December 2017.

Food on international markets was almost 3 percent cheaper than last January, FAO said.

Agricultural commodities have emerged from a highly volatile period and FAO has said it expects them to remain stable over the next decade. Food cost 24 percent less in 2017 than at its 2011 peak, but strong demand may support prices this year, a FAO economist said last month.

FAO forecast an all-time record global cereal harvest, raising its forecast in 2017 to 2.64 billion tons, largely due to expectations of higher maize output in China, Mexico and the European Union.

Despite ample supplies, a weaker U.S. dollar helped to prop up international prices for wheat and maize, which are priced in dollars and therefore became cheaper to buy in other currencies.