According to the United Nations Food and Agriculture Organization (FAO), the world food price index decreased slightly in July, averaging 120.8 points, down from 121.0 in June. This decline was primarily driven by a 3.8% drop in the cereals price index, reaching its lowest level in nearly four years, as global export prices for major cereals fell for the second consecutive month.
Wheat prices specifically declined due to seasonal availability from ongoing winter wheat harvests in the northern hemisphere and favorable conditions for spring wheat crops in Canada and the U.S. Similarly, maize (corn) export prices also fell as harvests in Argentina and Brazil progressed ahead of last year’s pace, with robust crop conditions in the U.S.
Prior to July, the FAO food price index had risen for four consecutive months after hitting a three-year low in February, following a peak in March 2022 due to geopolitical tensions affecting crop exports. The July index is 3.1% lower than the same time last year and 24.7% below the high point of 2022.