Global food prices in April increased by 1.6% compared to March. This marks the third consecutive month of growth, according to the FAO's May report (Food and Agriculture Organization of the United Nations).
Why Wheat Prices Will Increase
Compared to April of last year, prices were 2% higher, but 18.4% lower compared to the peak in March 2022. "The increase in price indices for vegetable oils, meat, and grains was uneven and accompanied by a decline in price indices for sugar and dairy products," the document states.
The grain price index in April was 0.8% higher than in March and 0.4% higher than last year. This increase is attributed to rising prices for all major types of grains, except for sorghum and barley. Global wheat prices rose by 0.8% due to drought conditions in certain areas of the United States and an increased likelihood of below-average rainfall in Australia.
The rise in prices was also supported by expectations of a reduction in wheat acreage in 2026 as farmers shift to less resource-intensive crops amid high fertilizer prices driven by rising energy costs and disruptions related to the actual closure of the Strait of Hormuz.
Additional support for prices came from consistently high demand for ethanol amid high crude oil prices, as well as ongoing concerns regarding the economic accessibility of fertilizers, the FAO explains.
And Meat Prices Follow Suit
The meat price index in April increased by 1.2% compared to March, with an annual increase of 6.4%. All types of meat became more expensive, except for lamb, which remained stable.
Beef prices reached a new high amid rising export quotes in Brazil. An additional factor strengthening prices was high global demand, primarily from China.
Pork prices rose due to higher quotes in the European Union, although this increase was partially offset by a decline in prices in Brazil.
Poultry prices increased amid strengthening quotes in Brazil: active demand from several African countries more than compensated for the reduced purchases from Middle Eastern countries, where due to logistical and transportation restrictions, supplies had to be redirected through the Red Sea.
What About Sugar?
The sugar price index in April decreased by 4.7% compared to March, and was 21.2% lower on an annual basis.
"The decline in this index was mainly related to more favorable production forecasts in key producing countries in Asia, primarily in China and Thailand. The start of the new harvest in key southern sugarcane-growing areas in Brazil amid favorable weather conditions also intensified the overall downward pressure on global sugar prices," the report states.
The FAO food price index is a weighted average indicator that tracks the dynamics of international prices for five major food commodity groups.
